Physical oil market tightens as refiners scramble for crude: Kemp

LONDON (Reuters) by John Kemp – Physical crude markets are at last showing signs of tightening as record refinery consumption in the United States coincides with a slowdown in oil exports from the Middle East Gulf. U.S. refineries processed an average of almost 17.3 million barrels of crude per day last week, an increase of 620,000 barrels per day (bpd) compared with the same week in 2016. Fuel consumption by U.S. motorists remains largely flat but U.S. refineries are seeing higher demand for gasoline and diesel from Latin America where supplies have been hit by local refinery problems. Refinery crude consumption remains high in most other geographical markets in an indication fuel demand is growing strongly, especially in emerging economies. OPEC exports have been rising as a result of increasing output from Libya and Nigeria, which are not capped under the organization’s production deal, and poor compliance from some members. But Saudi Arabia has been restricting exports in recent weeks and has stated exports will be below 6.6 million bpd in August, compared with 7.3 million bpd in August 2016, and the lowest for the month since 2010. Saudi Arabia and Iraq both tend to export less during the summer

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Source: CTRM Center

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