Crude oil prices ticked slightly higher today after the U.S. Energy Information Administration reported a large draw in crude oil inventories for the week to December 20.
The change compares with a modest inventory dip of 900,000 barrels for the previous week and a draw of 3.2 million barrels as estimated by the American Petroleum Institute for the week to December 20.
Total motor gasoline inventories added 1.6 million barrels in the period, with production averaging 9.9 million barrels daily. This compared with a build of 2.3 million barrels for the previous week when gasoline production stood at an average 9.9 million barrels.
In middle distillates, the EIA estimated an inventory fall of 1.7 million barrels for the third week of December, with production averaging 5.3 million barrels daily. This compared with an inventory draw of an inventory draw of 3.2 million barrels for the previous week, when production stood at an average 5.1 million barrels daily.
Oil prices meanwhile perked up earlier today as prices continue to ride the coattails of Beijing’s attempt at speeding up economic growth through a series of stimulus packages, all of which have been seen as bullish for crude oil prices to varying degrees.
Despite the stimulus, however, China’s two biggest oil companies recently forecast peak demand in the world’s biggest importer. CNPC earlier this month said demand for oil in China could peak in 2025, and Sinopec said a few days later the peak may take place in 2027.
China’s oil demand growth has been slowing down due to weaker economic performance and a shift to electric vehicles and LNG-fueled trucks. However, in focusing on that, many observers seem to be forgetting that China, while the biggest importer of the commodity, is not the only importer. India, according to most forecasts, is about to replace China as the biggest driver of global oil demand in the coming years. Although the subcontinent is a smaller consumer overall, it will contribute to demand, which appears to be surprisingly resilient even in regions that are trying to give up hydrocarbons, such as Europe.
