ING Global Economics Team
ING Economic and Financial Analysis
Oil prices bounced higher yesterday on a constructive weekly inventory report from the Energy Information Administration.
Energy – Kazakhstan Oil production surges
Oil prices strengthened yesterday with ICE Brent seeing its biggest gain since the end of February, settling 2% up on the day, taking it back above US$70/bbl. A lower-than-expected increase in US crude oil inventories supported the market, while better-than-expected US consumer price inflation data also helped sentiment.
Energy Information Administration (EIA) data shows that US commercial crude oil inventories increased by 1.45m barrels over the last week. That’s less than the roughly 2m barrel build the market was expecting – and below the 4.2m barrel increase the American Petroleum Institute (API) reported the previous day. Refiners increased operating rates over the week, with crude oil inputs increasing by 321k b/d. Yet despite stronger refinery activity, refined product stocks declined. Gasoline inventories fell by 5.74m barrels, while distillate stocks decreased by 1.56m barrels. Implied demand for oil products grew by 1.06m b/d week on week, with implied gasoline demand up 305k b/d. Overall, the data was constructive, especially the large drop in gasoline stocks.
OPEC’s latest monthly oil market report, released yesterday, left both demand and supply estimates unchanged for 2025 and 2026. OPEC continues to forecast that 2025 oil demand will grow by 1.45m b/d year on year, while demand grows at 1.43m b/d next year. OPEC remains fairly bullish on demand, with their numbers above both the EIA and the International Energy Agency (IEA).
Meanwhile, OPEC production grew by 154k b/d MoM to 26.86m b/d in February. Nigeria and Iran were the key drivers behind this supply growth. Looking at broader OPEC+, supply grew by 363k b/d. Kazakh output surged by 198k b/d to 1.77m b/d, well above its production target of 1.47m b/d. Kazakhstan has said it will cut output in the future to compensate for this overproduction.
In natural gas, investment funds continued to cut their net long in the Title Transfer Facility (TTF) over the last week, selling 48.1TWh, leaving them with a net long of 126.7TWh. That’s the smallest net long held since May 2024. The move over the last week was driven by fresh shorts entering the market, rather than longs liquidating.
Agriculture – Indian Sugar production to fall
The latest estimates from the Indian Sugar and Bio-energy Manufacturers Association (ISMA) show that gross sugar output (excluding sugar diverted for ethanol production) could fall to around 26.4mt in 2024/25, That compared to its previous forecast of 27.3mt. Lower cane yields in some major producing regions were primarily responsible for the lower output estimates. Sugar allocation for ethanol production is expected to fall to 3.5mt, compared with an earlier estimate of 3.8mt. Sugar consumption might average around 28mt. The country will likely export 1mt of sugar this season. 2024/25 ending stocks are estimated at at 5.4mt.
Read the original analysis: The commodities feed: Big drop in US gasoline stocks
Content disclaimer: This publication has been prepared by ING solely for information purposes irrespective of a particular user's means, financial situation or investment objectives. The information does not constitute investment recommendation, and nor is it investment, legal or tax advice or an offer or solicitation to purchase or sell any financial instrument. Read more here: https://think.ing.com/content-disclaimer/
Recommended Content
Editors’ Picks
EUR/USD bounces off lows near 1.0820, Dollar loses traction
EUR/USD attempts some recovery following lows near 1.0820 as the US Dollar chalks up another strong day. In the meantime, persistent tariff jitters and disappointing February US Producer Price data are keeping the pair on the back foot.
Gold pushes higher, retargets its all-time high
Gold is on a roll, surpassing the $2,950 mark per troy ounce amid the continuation of the upside impulse so far this week. Escalating trade tensions have heightened fears of an economic downturn, creating a risk-averse atmosphere that continues to make the precious metal an attractive safe haven.
GBP/USD succumbs to USD gains, remains near 1.2940
Persistent buying pressure in the Greenback is weighing on risk sentiment, motivating GBP/USD to gyrate around the 1.2940 region and erase its two-day rally for now.
Metaverse narrative stalls as price action fades, but on-chain data signals continuing accumulation
Metaverse tokens are cryptocurrencies associated with virtual worlds, digital economies, and immersive online experiences. Tokens like Sandbox, Decentraland, and Axie Infinity, three of the most prominent assets during the Metaverse boom of 2021, continue to face correction since they topped in early December.
Brexit revisited: Why closer UK-EU ties won’t lessen Britain’s squeezed public finances
The UK government desperately needs higher economic growth as it grapples with spending cuts and potential tax rises later this year. A reset of UK-EU economic ties would help, and sweeping changes are becoming more likely.
The Best brokers to trade EUR/USD
SPONSORED Discover the top brokers for trading EUR/USD in 2025. Our list features brokers with competitive spreads, fast execution, and powerful platforms. Whether you're a beginner or an expert, find the right partner to navigate the dynamic Forex market.