Crude oil prices were mixed this week following Wednesday's weekly EIA crude and gasoline report indicating inventories fell more than expected. However, gains were limited by signs of progress in Ukraine peace talks, which could pave the way for fewer restrictions on Russian crude exports.
President Trump is pushing for a summit between Presidents Putin and Zelenskiy soon. Any resolution to the Russian-Ukrainian war could be bearish for crude prices, as an end to the war could mean allowing Russian crude to trade freely and could lead to an end to sanctions on Russian energy exports.
Concern about higher OPEC production is weighing on crude prices after OPEC+ on August 2 endorsed an additional 547,000 bpd increase in its crude production for September 1. OPEC+ is boosting output to reverse the 2-year-long production cut, gradually restoring a total of 2.2 million bpd of production by September 2026. OPEC+ has 1.66 million bpd of supplies that are currently due to remain offline until late 2026. OPEC July crude production fell by -20,000 bpd to 28.31 million bpd.
A decline in crude oil held worldwide on tankers is bullish for oil prices. Vortexa reported Monday that crude oil stored on tankers that have been stationary for at least seven days fell by -12% w/w to 82.49 million bbl in the week ended August 15.
Wednesday's weekly EIA report showed that (1) US crude oil inventories as of August 15 were -5.6% below the seasonal 5-year average, (2) gasoline inventories were -0.7% below the seasonal 5-year average, and (3) distillate inventories were -13.0% below the 5-year seasonal average, news of which has pushed oil process higher.
As we head into the final week of August and a welcome Bank Holiday weekend fuel card prices are to remain fairly static and in line with the current weeks pricing.
