Oil up on falling US crude stock

Source:Reuters-Global Times Published: 2017/8/16 17:53:40

Slowdown expected in fuel consumption growth

Oil prices edged up on Wednesday, lifted by declining US crude inventories, although markets were still restrained by general oversupply.

Market focus was turning to the release of official US Energy Information Administration data later on Wednesday for a further update on inventories.

Brent crude futures were at $51.06 per barrel, up 0.45 percent from their last close.

Traders said that reports of a dip in Libyan output to between 130,000 and 150,000 barrels per day (bpd), down from 280,000 bpd, had supported Brent.

US West Texas Intermediate (WTI) crude futures were at $47.71 a barrel, up 16 cents.

US crude inventories fell by 9.2 million barrels in the week leading up to August 11 to 469.2 million, industry group the American Petroleum Institute said on Tuesday.

That compared with analyst expectations for a decrease of 3.1 million barrels.

"The market took it as a mildly bullish report," said William O'Loughlin of Australia's Rivkin Securities.

More broadly, analysts said ample supplies were preventing prices from moving much higher.

On the demand side, analysts see a gradual slowdown in fuel consumption growth.

In China, State-owned China National Petroleum Corporation (CNPC) said on Wednesday that gasoline demand would likely peak around 2025 and outright oil consumption would top out around 2030.

China's energy consumption will peak at 4.06 billion tons of oil equivalent by 2040, according to a forecast issued in CNPC's annual long-term energy outlook.

In the US, energy consultancy Wood Mackenzie said gasoline demand was already peaking due to improving fuel efficiency and the rise of electric vehicles.

This means that oil demand from the world's two biggest consumers may soon stall, while consumption has already peaked in Europe and Japan.

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