Crude oil futures were lower during mid-morning trade in Asia Thursday despite a fall reported in US crude stocks, as market participants remained focused on growth and demand related concerns. At 11:05 am Singapore time (0305 GMT), front-month ICE Brent September futures were down 48 cents/b (0.75%) from Wednesday’s settle at $63.34/b, while the NYMEX August light sweet crude futures contract was 40 cents/b lower (0.69%) at $56.94/b.
According to data released by the US Energy Information Administration Wednesday, US crude stocks were down by just 1.01 million barrels for the week ended June 28. Analysts surveyed Monday by S&P Global Platts were looking for US crude stocks to have declined by 3.7 million barrels. Data from the American Petroleum Institute out Tuesday showed an even higher stock draw of 5 million barrels last week.
“Stockpiles shrank by only 1.085 million barrels, against expectations of a 3 million barrels drawdown,” said ANZ analysts in a note Thursday. The analysts called the draw a “disappointment” against what market participants were expecting. US gasoline inventories fell 2.33 million barrels to 58.56 million barrels during the week ended 28 June, the EIA data showed Wednesday. The draw put regional stocks at the lowest since March 2018 and 9.7% below the five-year average for this time of year.
Analysts, however, noted that growth and demand related concerns continued to grab attention with the US and China now resuming talks to resolve their trade deal.
Elsewhere, market participants were also watching out for developing geopolitical tensions between the US and Iran. Major-General Hossein Salami on Wednesday said Iran had “completely closed the path for the enemy” in the military sphere, Iran’s Fars news agency reported.