Mar WTI crude oil (CLH23) this morning is up +0.77 (+0.94%), and Mar RBOB gasoline (RBH23) is up +4.96 (+1.87%). Â Feb Nymex natural gas (NGG23) is up +0.072 (+2.27%).
Crude oil and gasoline prices this morning are moderately higher, with gasoline climbing to a 2-1/2 month high. Â Oil prices are higher on expectations for Chinese energy demand to strengthen as China's economy reopens from pandemic lockdowns. Â Also, strength in stocks today is bolstering confidence in the economic outlook and energy demand. Â However, a stronger dollar today is limiting the upside in energy prices. Â
Feb nat-gas this morning is moderately higher on expectations for colder temperatures to move into the U.S., boosting heating demand for nat-gas. Â Forecaster Maxar Technologies said today that extreme below-normal temperatures are expected from the Rockies to the Midwest from Jan 27-30
Crude prices have support as the removal of pandemic travel restrictions has bolstered expectations for a jump in domestic and international flights in China during the week-long Lunar New Year that began on Saturday.
China boosted its crude import quotas earlier this month, a sign from the world's largest crude importer that it is gearing up to meet higher demand. Â As of last week, China has issued a combined 132 million metric tons (MMT) of quotas for crude imports in 2023, well above the quota for 109 MMT at the same time last year. Â Â Â
In a bullish factor, Vortexa reported today that the amount of crude stored on tankers that have been stationary for at least a week fell -1.2% w/w to 86.77 million bbl in the week ended January 20.
Increased OPEC crude output is bearish for oil prices. Â OPEC Dec crude production rose +150,000 bpd to 29.140 million bpd. Â OPEC+ on December 4 decided to keep the group's crude production targets unchanged for January, in line with expectations. Â OPEC+ will meet again on February 1 to discuss its production targets.
Last Thursday's EIA report showed that (1) U.S. crude oil inventories as of January 13 were +3.0% above the seasonal 5-year average, (2) gasoline inventories were -7.7% below the seasonal 5-year average, and (3) distillate inventories were -19.7% below the 5-year seasonal average. Â U.S. crude oil production in the week ended January 13 was unchanged w/w at 12.2 million bpd, which is only 0.9 million bpd (-6.9%) below the Feb-2020 record-high of 13.1 million bpd.
Baker Hughes reported last Friday that active U.S. oil rigs in the week ended January 20 fell by -10 rigs to 613 rigs, below the 2-1/2 year high of 627 rigs posted on December 2. Â U.S. active oil rigs have more than tripled from the 17-year low of 172 rigs seen in Aug 2020, signaling an increase in U.S. crude oil production capacity.
Â
More Crude Oil News from Barchart
- Crude Oil Pushes Higher on Chinese Energy Demand Optimism
- Crude Gains on Chinese Energy Demand Optimism
- Crude Posts Moderate Gains on Expectations of Stronger Chinese Energy Demand
- Crude Prices Underpinned by Outlook for Stronger Chinese Energy Demand
On the date of publication, Rich Asplund did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
/Microsoft%20sign%20at%20the%20headquarters%20by%20VDB%20Photos%20via%20Shutterstock.jpg)
