One analyst even forecasts a possible supply shortage: File Image/PixaBay
Crude traders maintaining their hope in improving U.S./China relations was credited partly for initial losses being mitigated on Tuesday, with Brent settling up 2 cents at $61.59 per barrel after falling as low as $60.66, and West Texas Intermediate ending 27 cents lower at $55.54 after earlier sinking to $54.61.
However, the mitigation also relied upon that most unreliable of factors, predictions of U.S. crude inventory movement.
Tuesday's session was heavily influenced by a Reuters forecast showing gasoline stocks likely falling 2.2 million barrels last week (which would be their fifth weekly drawdown), and distillates falling for a sixth week in a row by 2.4 million barrels.
Phil Flynn, senior market analyst, Price Futures Group Inc.
If they don't get going soon, we'll have a shortage of supply.
Still, the Energy Information Administration corroborated the forecasts to a degree by disclosing that refinery runs slowed down in September for seasonal maintenance and were still low at around 85 percent of total capacity in the week ended October 18.
Phil Flynn, senior market analyst at Price Futures Group Inc., noted that the low runs "may be slightly bearish for crude in the short run, but should be wildly bullish for the products; if they don't get going soon, we'll have a shortage of supply."
For his part, Brian Gilvary, chief financial officer at BP, told media that due to the U.S./China trade tensions, Brent was finely balanced at about $60 per barrel but that price was more likely to move lower than higher in the near-term.
He added that global oil demand growth slowed to 900,000 barrels per day (bpd) in the third quarter compared with demand growth of 1.3 million bpd in the first three months of the year and 1 million bpd in the second quarter.
But at least one energy giant is betting on the health of long term market conditions: Saudi Arabia state-owned oil giant Aramco is planning to announce the start of its long-anticipated public offering on Sunday November 3, according to three sources with direct knowledge of the matter.
Plus, state broadcaster Al Arabiya reported that shares of the company will begin trading on the Tadawul stock exchange on December 11.