Oil inventories decline by more than 5 million barrels

Oil inventories decline by more than 5 million barrels: On Tuesday 14th September 2021 the American Petroleum Institute (API) declared a lower in crude oil stockpiles by 5.437 million barrels by the week ending on 10th September, exceeding analysts’ expectations for a lower by 3.903 million barrels in the week.

In the last week the API declared a decline in oil stockpiles by 2.882 million barrels,
less than the 3.832 million barrels were expected for the week by analysts.

The API declared that gasoline stockpiles drew by 2.882 million barrels by the week ending on 10th September compared with the previous week’s rise by 6.414 million barrels.

Distillate stockpiles fell by 2.888 million barrels for this week compared with the previous week’s drop by 3.748 million barrels.

Cushing stockpiles dropped by 1.345 million barrels this week after last week’s rise by 1.794 million barrels.

Topics:

The Oil prices for the week
Oil production rates for the week
Oil demand expectations for the third and fourth quarters
Crude oil stockpiles international developments
OPEC countries increased their production from May

Oil prices for the week

Oil prices fell on Tuesday before data publishing, although the International Energy Agency expected strong recovery in the international oil demand,
in addition to the shut down due to hurricanes Ida and Nicholas.

West Texas Intermediate crude fell 0.30% on Tuesday afternoon till data was published,
a while after it was for 70.24$ a barrel, equivalent to 1$ rise throughout the week.

Brent crude was for 73.43% a barrel, lowered 0.20% on the day.

In this year oil stockpiles disposed of more than 70 million barrels.

The API data shows a decline of 6% down the average of the five years for the same time of the year.

Oil production rates for the week

This week oil stockpiles affected by the sharp drop in the American production, by 1.5 million barrels per day in the last week,
the biggest loser in a week since Energy Information Administration (EIA) has started tracking data,
to 10 million barrels per day as oil producers in gulf of Mexico suspended production due to hurricane Ida.

Oil demand expectations for the third and fourth quarters

Oil demand expectations changed in 2021 for the third and fourth quarters, by 98.46 and 99.70 million barrels per day in a row.

The previous expectations were 98.23 million barrels per day for the third quarter and 99.82 million barrels per day for the fourth quarter,

the world’s oil consumption was 90.73 million barrels per day in 2020.

Crude oil stockpiles international developments

The OECD organization for economic co-operation and development countries Commercial oil reserves reached 2.912 billion barrels in July 2021,
showing a rise by 10.5 million barrels compared with June’s data.

On that level oil reserves reached 306 million barrels, less than they were in 2020, by 122 million barrels,
and less than the average of the five years.

At the same time crude oil stockpiles in the advanced countries lowered by 5.6 million barrels in July,
while other petroleum products rose by 16.2 million barrels.

These quantities covered the (OECD) needs of oil by 63.7 million barrels per day,
less than the 11.6 million barrels per day of 2020 and also less than the average of the five years.

OPEC’s expectations for oil production by the non-members in 2021, lowered by 170.000 barrels per day due to hurricane Ida.

The expectations were mainly amended due to offer expectations in the third quarter of 2021,
oil offer was 500.000 barrels per day, less than expected.

Such changes followed the cut in production in North America due to a fire in an offshore platform and supply suspension due to hurricane Ida.

Generally oil offer growth in the oil market in 2021 will reach 900.000 barrels per day to 63.8 million barrels per day;
this would happen due to the rise of production in Canada, Russia, China, The USA, Brazil, and Norway.

August’s report

On the contrary, in August’s report, OPEC raised its expectations for oil supply growth by the non-members countries in 2021
and 2022 by 0.27 million barrels per day and 0.84 million barrels per day in a row.

This comes after OPEC’s decision to increase production by 0.4 million barrels till September 2022,
OPEC increased its production in August 2021 by 0.15 million barrels per day to reach 26.76 million barrels per day.

At the same time the countries didn’t break the agreement to reduce production in August by 121% of the plan compared with July’s 2021, 115%.

According to the report Saudi Arabia which lately gave up the extra voluntary reduction,
its production was 9.5 million barrels per day (rose by 70.000 barrels per day by July).

OPEC countries increased their production from May

Iraq increased its oil production by 90.000 barrels per day to reach 4.1 million barrels per day,
in Emirates the production rose by 55.000 barrels per day to reach 2.8 million barrels per day.

In Angola the daily production rose by 43.000 barrels to reach 1.1 million barrels per day.

At the same time Nigeria’s oil production fell by 114.000 barrels per day to reach 1.27 million barrels per day in August,
on the other hand the production in Congo drew by 14.000 barrels per day to reach 249 million barrels per day.

OPEC’s agreement

OPEC’s agreement to reduce production includes 10 out of 13 members in the organization, while Iran, Libya, and Venezuela are not included.

In August the agreement members’ production reached 22.59 million barrels per day, while the agreement recommended producing 23.286 million barrels.

Totally it was possible to take 4.1 million barrels per day out of the market to the recommended level in the agreement instead of the 3.397 million barrels needed;
accordingly the agreement terms were fulfilled.

OPEC members are trying to raise the production by 400.000 barrels per day monthly according to the agreement , as it is valid for October ,
yet a decision is about to be made in the next ministerial meeting on 4th October 2021.

Oil inventories decline by more than 5 million barrels

Oil inventories decline by more than 5 million barrels

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