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The crude benchmarks have already chalked up four weekly gains in a row, with supplies expected to tighten due to output cuts from the Organization of the Petroleum Exporting Countries (OPEC) and allies. Earlier-loading Brent contracts are selling above later loadings, a price structure known as backwardation indicating traders see tight supply, with the six-month spread near a two-and-a-half month high. In China, the world's second-biggest oil consumer, leaders pledged to step up economic policy support. U.S. industry data on inventories is expected at around 2030 GMT. Four analysts polled by Reuters estimated on average that crude inventories fell by about 2 million barrels in the week to July 21.

Persons: Brent, Sudarshan Varadhan, Jan Harvey, Susan Fenton Organizations: U.S, West Texas, Organization of, Petroleum, ING, Fed, European Central Bank, Reuters, Thomson Locations: China, United States, Baton Rouge

JPMorgan's chief global markets strategist, Marko Kolanovic, advises investors to play commodities against recession risks. Kolanovic named natural gas as his top pick within the commodities sector. Investors can look to the United States Natural Gas Fund LP (UNG) to gain exposure to the commodity; it's down about 48% year to date. The strategist forecasts U.S. natural gas prices to undergo a 25% rally in the next few months on expectations of a supply growth reversal. Backwardation is what happens when the spot price is higher than the price of the approaching futures' contracts.

Persons: Marko Kolanovic, Kolanovic, — CNBC's Michael Bloom Organizations: United States Natural Gas Fund, DB Agriculture Fund, Brent Oil Fund Locations: U.S

How much more will arrive in the market of last resort depends on China, which is stepping up imports of refined zinc. China's refined zinc imports, exports and net tradeCHINA FLIPS BACK TO NET IMPORTERChina imported 45,329 metric tons of refined zinc in June, the highest monthly tally since May 2021. The country exported 81,000 metric tons of zinc in 2022, including shipments of 7,800 metric tons to Mexico and 3,400 metric tons to the United States, two destinations that haven't in the past featured in China's zinc trade. The country's monthly refined zinc production has been notching double-digit growth rates since March. So far, however, there is scant evidence of a significant build of surplus metal in the mainland market.

Persons: It's, Paul Simao Organizations: London Metal Exchange, China, Shanghai Futures Exchange, Shanghai Metal, International, Study, Reuters, Thomson Locations: Singapore, Asian, contango, China, CHINA, Mexico, United States, backwardation, Shanghai, Europe, Antwerp

From a fundamental perspective, the production cuts announced by Saudi Arabia and Russia are expected to remove excess barrels from the market. Since most fund positions are concentrated in nearby months, where liquidity and volatility are greatest, the wave of buying has accelerated the return to a backwardation structure. The exceptionally low level of hedge fund positions in crude means there is plenty of scope for position-building to anticipate, accelerate and amplify the move. Related columns:- Oil investors less bearish after Saudi output cut extended (July 10, 2023)- Is oil market’s glass half full or half empty? (June 29, 2023)- Frustrated oil bulls made to wait for price recovery (June 22, 2023)- Saudi Arabia’s 'lollipop' has yet to sweeten oil prices (June 6, 2023)John Kemp is a Reuters market analyst.

Persons: Brent, WTI, John Kemp, Paul Simao Organizations: Thomson, Reuters Locations: Saudi Arabia, Russia, backwardation, North America, Europe, China, Brent, Saudi

☆ The oil market faces the risk of a major shock as high interest rates cause traders to dump inventories
▼ + stars: | 2023-07-05 | by ( Filip De Mott | ) www.businessinsider.com time to read: +3 min

Oil inventories are falling as high interest rates make the price of storage costly, top analyst Amrita Sen wrote. That could expose the oil market to a major shock, she warned in the Financial Times. "All this will leave the market vulnerable to shocks and unexpected Opec+ policy moves by the end of the year. Higher rates have forced traders to pay more in financing to hold onto oil-storage consignments. "All this will leave the market vulnerable to shocks and unexpected Opec+ policy moves by the end of the year," she said.

Persons: Amrita Sen, Buckle, —, Sen, today's backwardation, destocking Organizations: Financial Times, Service, Federal Reserve, Strategic Petroleum Reserve Locations: Asia

TOKYO, June 29 (Reuters) - Oil prices eased on Thursday, paring some of the previous day's gains, as investors took profits on concerns that further interest rate hikes by central banks could dampen economic growth and global fuel demand. "The market turned around on renewed worries about further rate hikes in the U.S. and Europe, which will reduce global oil demand," said Hiroyuki Kikukawa, president of NS Trading, a unit of Nissan Securities. Leaders of the world's top central banks reaffirmed on Wednesday they think further policy tightening will be needed to tame stubbornly high inflation but still believe they can achieve that without triggering outright recessions. Adding to pressure, annual profits at industrial firms in China, the world's second-biggest oil consumer, extended a double-digit decline in the first five months as softening demand squeezed margins. Brent's six-month backwardation - a price structure whereby sooner-loading contracts trade at higher prices than later-loading ones - reached its lowest since December, indicating higher demand for immediate delivery.

Persons: paring, Hiroyuki Kikukawa, Jerome Powell, Christine Lagarde, Kikukawa, Yuka Obayashi, Sonali Paul Organizations: Brent, . West Texas, U.S . Energy Information Administration, NS, Nissan Securities, U.S . Federal, European Central Bank, Thomson Locations: TOKYO, U.S, Europe, China, United States

☆ Oil steadies after spiking on U.S. inventory fall
▼ + stars: | 2023-06-29 | by ( Ahmad Ghaddar | ) www.reuters.com time to read: +2 min

Brent crude futures was up 10 cents, or 0.1%, to $74.13 a barrel by 1032 GMT. Nonetheless, the impact that stocks have on oil prices was on display yesterday on a smaller scale," PVM Oil analyst Tamas Varga said. Concerns about the impact that rising interest rates will have on economic growth came back to the fore, however, halting the rally. Adding to pressure, annual profits at industrial firms in China, the world's second-biggest oil consumer, extended a double-digit decline in the first five months as softening demand squeezed margins. "The lack of prospects for fuel demand growth has limited the gain in oil prices, even with supply curbs by oil producers," said Tetsu Emori, CEO of Emori Fund Management Inc.

Persons: Tamas Varga, Jerome Powell, Christine Lagarde, Tetsu Emori, Yuka Obayashi, Jason Neely Organizations: Brent, . West Texas, U.S . Energy Information Administration, . Federal, European Central Bank, Emori Fund Management Inc, Thomson Locations: China, Saudi Arabia, OPEC

Commercial inventories of crude oil and refined products in the OECD advanced economies were around 2,842 million barrels at the end of May, according to the U.S. Energy Information Administration (EIA). While the real price was a little low, it was not obviously mispriced or significantly below the long-term median price of $81. The spread was slightly high, but again not obviously mispriced, or significantly above the long-term median of a backwardation of 98 cents. Chartbook: Global oil stocks and pricesThere are no comprehensive estimates for OECD inventories in June as yet. Related columns:- Frustrated oil bulls made to wait for price recovery (June 22, 2023)- Saudi Arabia’s 'lollipop' has yet to sweeten oil prices (June 6, 2023)John Kemp is a Reuters market analyst.

Persons: Brent, John Kemp, Barbara Lewis Organizations: Global, OECD, U.S . Energy Information Administration, ⁺, Thomson, Reuters Locations: United States, Saudi Arabia, Russia, Venezuela, Iran, North America, Europe, China, Saudi

☆ Oil prices fall on concerns of slow fuel demand, weak China data
▼ + stars: | 2023-06-29 | by ( ) www.cnbc.com time to read: +3 min

Oil prices fell on Thursday, paring some of the previous day's gains, as investors took profits on concerns of further interest rate hikes dampening economic growth and global fuel demand while weak economic data in China also weighed on sentiment. "The market turned around on renewed worries about further rate hikes in the U.S. and Europe, which will reduce global oil demand," said Hiroyuki Kikukawa, president of NS Trading, a unit of Nissan Securities. Adding to pressure, annual profits at industrial firms in China, the world's second-biggest oil consumer, extended a double-digit decline in the first five months as softening demand squeezed margins. Brent's six-month backwardation - a price structure whereby sooner-loading contracts trade at higher prices than later-loading ones - reached its lowest since December, but still indicated higher demand for immediate delivery. "Behind the backwardation is the expectation that the immediate demand for fuels will stay firm as the United States has entered the driving season, but the global economy will slow down toward the second half of this year, reducing oil demand," NS Trading's Kikukawa said.

Persons: paring, Brent, Hiroyuki Kikukawa, Jerome Powell, Christine Lagarde, Tetsu Emori, Kikukawa Organizations: TotalEnergies, . West Texas, U.S . Energy Information Administration, NS, Nissan Securities, U.S . Federal, European Central Bank, Emori Fund Management Inc Locations: Leuna, Germany, China, U.S, Europe, Saudi Arabia, OPEC, United States

NEW YORK, June 28 (Reuters) - Oil prices climbed about 3% on Wednesday as the second straight weekly draw from U.S. crude stockpiles was bigger than expected, offsetting worries that further interest rate hikes could slow economic growth and reduce global oil demand. U.S. West Texas Intermediate (WTI) crude rose $1.86, or 2.8%, to settle at $69.56, narrowing Brent's premium over WTI to its lowest since June 9. The U.S. Energy Information Administration (EIA) said crude inventories dropped by 9.6 million barrels in the week ended June 23, far exceeding the 1.8-million barrel draw analysts forecast in a Reuters poll and also much bigger than the 2.8 million barrel draw a year earlier. This report could be a bottom (for oil prices)," said Phil Flynn, an analyst at Price Futures Group. Investors remained cautious that interest rate hikes could slow economic growth and reduce oil demand.

Persons: Brent, Phil Flynn, Jerome Powell, Flynn, Powell, Christine Lagarde, Gelber, Shariq Khan, Alex Lawler, Mohi Narayan, Emma Rumney, Mark Potter, David Gregorio, Cynthia Osterman Organizations: YORK, . West Texas, U.S . Energy Information Administration, Price Futures Group, Investors, . Federal, European Central Bank, Associates, Organization of, Petroleum, Thomson Locations: WTI, Russia, Saudi, China, Bengaluru, London, New Delhi

U.S. West Texas Intermediate (WTI) crude rose $1.63, or 2.45%, to $69.33. The U.S. Energy Information Administration (EIA) said crude inventories dropped by 9.6 million barrels in the week ended June 23, far exceeding the 1.8-million barrel draw analysts forecast in a Reuters poll and also much bigger than the 2.8 million barrel draw a year earlier. This report could be a bottom (for oil prices)," said Phil Flynn, an analyst at Price Futures Group. Investors remained cautious that interest rate hikes could slow economic growth and reduce oil demand. Analysts at energy consulting firm Gelber and Associates said that decline in backwardation suggested "diminishing worries over potential supply shortages."

Persons: Brent, Phil Flynn, Jerome Powell, Flynn, Powell, Christine Lagarde, Gelber, backwardation, Shariq Khan, Alex Lawler, Mohi Narayan, Emma Rumney, Mark Potter, David Gregorio Our Organizations: YORK, . West Texas, U.S . Energy Information Administration, Price Futures Group, Investors, . Federal, European Central Bank, Associates, Organization of, Petroleum, Thomson Locations: WTI, Russia, OPEC, Saudi, China, Bengaluru, London, New Delhi

☆ Oil rises on large US stock draws, but rate hike fears linger
▼ + stars: | 2023-06-28 | by ( Mohi Narayan | Thomson Reuters | Reports On Everything How Asia S Fuel Use Recovers The Fallout Of To Tracking How The Global Energy Transition Impacts Refinery Expansion Plans | ) www.reuters.com time to read: +3 min

June 28 (Reuters) - Oil prices edged higher on Wednesday after industry data showed a larger-than-expected drawdown of U.S. inventories, signalling robust demand from the world's biggest oil consumer, but the gains were limited by worries over interest rate hikes. Both contracts had fallen by about 2.5% in the previous session on signals that central banks may not be done with interest rate hikes. "Tuesday's slump took Brent and WTI close to support levels that have held through the price dives of the past couple of months," said Vandana Hari, founder of oil market analysis provider Vanda Insights. Higher interest rates can weigh on economic activity and oil demand. Analysts said that markets have struggled to shake off fears that higher interest rates will weigh on global growth and oil demand.

Persons: Brent, WTI, Vandana Hari, Hari, Christine Lagarde, Mohi Narayan, Arathy Somasekhar, Muralikumar Anantharaman, Jamie Freed, Gerry Doyle Organizations: Brent, U.S, West Texas, Vanda Insights, American Petroleum Institute, Analysts, European Central Bank, Federal Reserve, National Australia Bank, Thomson Locations: Saudi, China

☆ Oil higher on large US stock draws, but rate hike fears linger
▼ + stars: | 2023-06-28 | by ( Mohi Narayan | Thomson Reuters | Reports On Everything How Asia S Fuel Use Recovers The Fallout Of To Tracking How The Global Energy Transition Impacts Refinery Expansion Plans | ) www.reuters.com time to read: +3 min

June 28 (Reuters) - Oil prices edged higher on Wednesday after industry data showed a larger-than-expected drawdown of U.S. inventories signalling robust demand from the world's biggest oil consumer, but the gains were limited by worries over interest rate hikes. Both contracts had fallen by about 2.5% in the previous session on signals that central banks may not be done with interest rate hikes. "Tuesday's slump took Brent and WTI close to support levels that have held through the price dives of the past couple of months," said Vandana Hari, founder of oil market analysis provider Vanda Insights. Higher interest rates can weigh on economic activity and oil demand. Analysts said that markets have struggled to shake off fears that higher interest rates will weigh on global growth and oil demand.

Persons: Brent, WTI, Vandana Hari, Hari, Christine Lagarde, Mohi Narayan, Arathy Somasekhar, Muralikumar Anantharaman, Jamie Freed Organizations: Brent, U.S, West Texas, Vanda Insights, American Petroleum Institute, Analysts, European Central Bank, Federal Reserve, National Australia Bank, Thomson Locations: Saudi, China

Oanda analyst Craig Erlam said prices were mainly at the mercy of "the ever-changing expectations for interest rates". European Central Bank President Christine Lagarde said on Tuesday that stubbornly high inflation will require the bank to avoid declaring an end to rate hikes. Higher interest rates can weigh on economic activity and oil demand. But the upbeat data suggested the Federal Reserve will likely have to continue raising interest rates to slow demand in the overall economy. The U.S. central bank, which has raised its policy rate by 500 basis points since March 2022, signaled this month that two additional rate hikes were warranted this year.

Persons: Brent, Craig Erlam, Christine Lagarde, Phil Flynn, Wagner, PVM's Tamas Varga, Saudi Arabia's, Li Qiang, Stephanie Kelly, Shadia Nasralla, Trixie Yap, Jan Harvey, David Goodman, Ed Osmond, Deepa Babington, Mark Heinrich Our Organizations: Brent, . West Texas, European Central Bank, Price Futures, Reserve, American Petroleum Institute, Reuters, Saudi, Thomson Locations: contango, Europe, United States, U.S, Russia, China

SummarySummary Companies Oil price structure implies demand bulls are retreating2-mth Brent spread in contango, implying oversupply concernECB poised for further rate hikesLONDON, June 27 (Reuters) - Oil prices slipped on Tuesday ahead of data shedding light on U.S. appetite for fuel during the summer driving season, with the Brent benchmark's price structure indicating bulls are retreating. U.S. inventory data from the American Petroleum Institute industry group is expected after 2000 GMT, followed by government data on Wednesday. For the two-month spread , the market is in shallow contango, the opposite price structure, indicating traders are factoring in a currently slightly oversupplied market. The oil market has shrugged off a clash between Moscow and Russian mercenary group Wagner which was averted on Saturday. Russian oil loadings have kept on schedule.

Persons: Brent, Craig Erlam, Christine Lagarde, Wagner, PVM's Tamas Varga, Saudi Arabia's, Premier Li Qiang, Trixie Yap, Jan Harvey, Louise Heavens Organizations: Brent, U.S, West Texas, Central Bank, American Petroleum Institute, Reuters, Saudi, Premier, Thomson Locations: contango, U.S, Moscow, Russian, China

LONDON, June 27 (Reuters) - There's a renewed scramble for copper sitting in London Metal Exchange (LME) warehouses. Headline LME copper stocks have slid from 100,100 tonnes to 77,050 over the last three weeks despite almost 30,000 tonnes of arrivals. The drain on LME copper stocks is puzzling given weakening manufacturing activity in both Europe and the United States. It wouldn't be the first time that the LME stocks signal has been refracted, and the lower the stocks, the easier it is to bend the light. The Shanghai exchange has experienced tightness across the front part of the curve since March, with time-spreads now also the widest since November.

Persons: Boliden's, Copper, Jan Harvey Organizations: London Metal Exchange, LME, U.S ., CME, Shanghai Futures Exchange, Shanghai Futures, ShFE's, International Energy Exchange, Shanghai Metal, Reuters, Thomson Locations: Europe, United States, U.S, London, ShFE, INE, Shanghai, China, Asia

☆ Why copper's 12% surge over the past month could signal bright times ahead for the broader economy
▼ + stars: | 2023-06-24 | by ( Matthew Fox | ) www.businessinsider.com time to read: +4 min

Copper prices have jumped as much as 12% from their May 25 low, and that could signal green shoots for the economy. Copper prices have long been viewed as a leading economic indicator because it is utilized in various sectors of the economy. Essentially, rising copper prices could signal increased demand and therefore increased economic activity, and vice versa for when copper prices fall. But rising copper prices aren't always driven by an increase in demand for the commodity, and could instead be impacted by other factors. Sosnick also said that recent interest rate cuts in China could be impacting copper prices more so than broad economic strength "since other key commodities like oil are hardly signaling economic strength."

Persons: Ryan Detrick, —, Katie Stockton, Stockton, Ryan Detrick wouldn't, he's, Detrick, Tom Lee, Steve Sosnick, Sosnick Organizations: Service, Carson Group, Interactive Locations: Stockton, China

In the physical market, dated Brent prices are in contango through the rest of June and July, indicating traders expect plenty of crude to be available. The second-month spread is firmer, in the 66th percentile, but still implies the market is expected to tighten only gradually in the third quarter. Global petroleum inventories are well below the long-term average, especially for refined fuels such as diesel and gas oil. If the global economy avoids recession and resumes steady growth, low inventories could quickly put explosive upward pressure on prices and spreads. At the same time, expectations about a strong rebound in the economy and oil consumption in China have been deferred.

Persons: Brent, John Kemp, Barbara Lewis Organizations: OPEC, OPEC ⁺, Thomson Locations: Saudi Arabia, contango, North America, Europe, China, U.S, Venezuela, Iran, Russia, Saudi

London Metal Exchange (LME) three-month tin has been treading water in a $23,700-26,800 range since the start of May. Although the demand outlook remains subdued, tin supply is facing two big threats, one from Myanmar and one from Indonesia, the world's largest exporter. Global tin supply, meanwhile, is now improving after an early-year drop in Indonesia shipments. Refined tin production fell year-on-year in May and Guangxi China Tin Group, the world's sixth-largest tin producer, has just announced a 40-50 day maintenance break from the end of this month, according to the ITA. Indonesia currently only has enough downstream capacity to absorb 5% of its domestic tin production, meaning that any restrictions will likely come in phases.

Persons: Minsur, International Tin Association . Tin, It's, David Evans Organizations: London Metal Exchange, Global, Shanghai Futures Exchange, U.S, Global Semiconductor, HIT, World Semiconductor Trade Statistics, Local, United Wa State Army, International Tin Association ., ITA, Guangxi China Tin Group, Thomson, Reuters Locations: Midwest, London, imploding, Myanmar, Indonesia, Peruvian, United States, Europe MYANMAR, Wa, China, Wa State, Guangxi China, INDONESIA

☆ Oil prices rise 3% after China rate cut
▼ + stars: | 2023-06-13 | by ( ) www.cnbc.com time to read: +2 min

Oil prices climbed 3% on Tuesday, recovering from steep losses the previous session, after China's central bank lowered a short-term lending rate for the first time in 10 months. The rate cut, aimed at adding momentum to a hesitant post-pandemic recovery in the world's second-largest economy and biggest crude importer, is likely increase oil demand. The Fed's rate hikes have strengthened the dollar , making dollar-denominated commodities more expensive for holders of other currencies and weighing on oil prices, so a rate hike pause could be bullish. Worries about demand have unraveled the temporary boost in oil prices from Saudi Arabia's pledge announced early this month to cut more production in July. The Organization of Petroleum Exporting Countries (OPEC) kept its forecast for 2023 global oil demand growth steady for a fourth month on Tuesday, slightly increasing expectations of Chinese demand growth.

Persons: Phil Flynn, Giovanni Staunovo, Saudi Arabia's Organizations: Brent, U.S . West Texas, Price Futures, European Central Bank, of Petroleum Exporting, International Energy Agency, Reuters Locations: U.S, Saudi

☆ Oil falls as economic fears overshadow Saudi output cut
▼ + stars: | 2023-06-06 | by ( Rowena Edwards | ) www.reuters.com time to read: +2 min

Brent crude futures were down $1.50, or 1.96%, to $75.21 a barrel by 1046 GMT. U.S. West Texas Intermediate crude fell $1.47, or 2.04%, to $70.68 a barrel. Backwardation in Brent crude oil futures — where the current value is higher than in later months — steepened after the weekend announcement with the six-month spread hitting a five-week high of $2.20/bbl on Monday. The U.S. services sector barely grew in May as new orders slowed, and market participants are waiting to see if the U.S. Federal Reserve will hike or hold interest rates in June. Higher interest rates could curb energy demand.

Persons: Brent, Backwardation, — steepened, Ole Hansen, Tamas Varga, PVM, Rowena Edwards, Arathy Somasekhar, Trixie Yap, Sriraj Kalluvila, Jason Neely Organizations: EIA, LONDON, Saudi, Brent, . West Texas, Citi, bbl, PMI, Saxo Bank, The, U.S . Federal, U.S . Energy Information Administration, Thomson Locations: Saudi Arabia, OPEC, U.S, Europe, China, Brent, The U.S, London, Houston, Singapore

In the physical oil market, where any short-term production cut should have the greatest and most immediate impact, the calendar spreads between nearby months strengthened only slightly. The unilateral Saudi cut, described by the country’s oil minister as a “lollipop”, is for a month, but could be extended. Chartbook: Brent prices and spreadsSTEMMING THE SLIDEThere is evident frustration among OPEC⁺ officials about the continued slide in prices despite three rounds of cuts announced since October 2022. U.S. oil production has continued to rise in a delayed response to last year’s very high prices, which has also kept the market well-supplied. But OPEC⁺ cuts have not (yet) been enough to lift prices and spreads rather than arresting their fall.

Persons: Brent, OPEC ⁺, ”, John Kemp, Barbara Lewis Organizations: OPEC, European Union, Global, OPEC ⁺, Thomson, Reuters Locations: Saudi Arabia, China, Saudi, North America, Europe

LONDON, May 12 (Reuters) - Global commercial oil inventories were close to their long-term seasonal average at the end of the first quarter of 2023 following massive releases from the U.S. Strategic Petroleum Reserve (SPR) over the previous 12 months. In the countries of the Organisation for Economic Cooperation and Development (OECD), commercial stocks of crude and refined products stood at 2,804 million barrels at the end of March (“Short-Term Energy Outlook”, EIA, May 12). Commercial petroleum inventories had increased by 200 million barrels compared with the same month a year earlier but over the same time the U.S. SPR was depleted by 195 million barrels. The progressive normalisation of inventories took the upward pressure off oil prices and calendar spreads over the past year. Related columns:- Oil market has absorbed surprise production cut by OPEC⁺ (April 26, 2023)- Oil market has fully absorbed impact of Russia's invasion of Ukraine (March 9, 2023)John Kemp is a Reuters market analyst.

Oil prices dropped almost 4% on Wednesday as jitters about a U.S. economic downturn overshadowed a larger-than-expected fall in U.S. crude inventories. The OPEC+ group of leading oil producers does not see the need for further oil output cuts but is always able to adjust its policy, Novak said. Data on Thursday showed U.S. economic growth slowed by more than expected in the first quarter, although jobless claims fell in the week ending April 22. Oil prices were also pressured as weak risk sentiment spread from the banking sector after First Republic Bank's continued slump. Analysts see weak refinery margins as a major contributor to the recent oil price decline, with oil broker PVM's Tamas Varga pointing to heating oil and gasoil as "the main possible culprit for the outsized weakness".

☆ Oil mixed as recession fears are tempered by U.S. inventories
▼ + stars: | 2023-04-26 | by ( Ahmad Ghaddar | ) www.reuters.com time to read: +2 min

U.S. crude oil stocks fell by about 6.1 million barrels in the week ended April 21, according to market sources citing American Petroleum Institute (API) figures on Tuesday. Analysts had expected crude inventories to fall by about 1.5 million barrels. Gasoline inventories fell by 1.9 million barrels last week while distillate inventories rose by 1.7 million barrels, the sources said. U.S. crude oil stockpiles have been falling since the middle of March as refineries have increased runs to produce more gasoline ahead of the peak summer demand period that starts in May. This has pushed WTI futures prices into backwardation, when prompt futures are higher than later-dated futures, reflecting the higher refinery demand.

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