Oil’s Recovery Capped by Stubborn U.S. Crude Glut, Dour Demand

  • WTI at four-month high, but rising supplies limiting rally
  • Gasoline stocks shrink yet demand showing seasonal weakness
Citi’s Morse Sees Oil Above $50 by End of 2020 as Production Slides
Lock
This article is for subscribers only.

Oil’s rally has hit a ceiling, with U.S. crude inventories holding near a record high and gasoline demand still at the weakest seasonal level in more than 20 years.

Futures in New York closed at a four-month high, but the U.S. benchmark crude has traded within a tight $2 range this month, struggling to hold above $41 a barrel. An Energy Information Administration report showing that domestic crude stockpiles rose by 5.65 million barrels last week is only adding to the malaise. While gasoline demand is improving -- particularly on the East Coast, where coronavirus cases are slowing -- seasonal consumption remains at a two-decade low.