International oil demand improved from the earlier week, pushed by a rebound in U.S. oil consumption, bolstered by strong Memorial Day journey actions.
That’s what analysts at J.P. Morgan said in a analysis be aware despatched to Rigzone by the JPM Commodities Analysis workforce late Thursday, including that, as of Might 28, “the month-to-month enlargement in international oil demand is monitoring at roughly 400,000 barrels per day”. The analysts outlined within the be aware, nonetheless, that this enlargement stays 250,000 barrels per day beneath their expectations.
“In keeping with our projections, international oil demand elevated over the previous week, reflecting heightened U.S. demand for gasoline and jet gas resulting from Memorial Day weekend journey and the official begin of the U.S. summer time driving season,” the analysts mentioned within the be aware.
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“Concurrently, U.S. distillate demand surged as weekly container arrivals and port exercise considerably improved, rising from 75.7 thousand containers to 102.8 thousand containers final week, in accordance with knowledge from the Port of Los Angeles,” the analysts added.
In a weblog posted on the GasBuddy web site on Might 27, GasBuddy’s head of petroleum evaluation, Patrick De Haan, highlighted that the U.S. common gasoline worth “didn’t fall fairly so far as anticipated for Memorial Day” however added that “it was nonetheless probably the most reasonably priced since 2021 – and, when adjusted for inflation, among the many least expensive in practically a decade”.
Oil Inventories
The J.P. Morgan analysts went on to focus on within the analysis be aware that, within the fourth week of Might, “seen OECD business oil inventories (together with these within the U.S., Europe, and Singapore) rose by two million barrels”. The analysts mentioned this rise was attributed to a 4 million barrel improve in oil product inventories, which they famous offset the 2 million barrel drop in crude oil shares. Month to this point, OECD shares have expanded by 30 million barrels, the J.P. Morgan analysts highlighted within the analysis be aware.
“Globally, whole liquid inventories edged up barely from the earlier week,” the analysts went on to state.
“Crude oil shares fell by a million barrels, whereas oil product inventories elevated by two million barrels. Month to this point, international liquid inventories have risen by 63 million barrels, with crude oil shares up by 67 million barrels,” they continued.
Earlier Softening
In a analysis be aware despatched to Rigzone by the JPM Commodities Analysis workforce on Might 21, J.P. Morgan analysts mentioned international oil demand had softened week over week, “primarily pushed by a decline in U.S. oil consumption”.
“As of Might 20, international oil demand has elevated by 340,000 barrels per day, and stays practically 300,000 barrels per day beneath our projections for the month,” the analysts said in that be aware.
“Yr to this point, international oil demand is monitoring a development of 1.0 million barrels per day, which is 70,000 barrels per day beneath our revised development expectations of 1.1 million barrels per day for the primary 5 months of the yr,” they added.
In that be aware, the analysts said that this determine is considerably decrease than the preliminary 1.3 million barrels per day development projections made within the firm’s 2025 outlook final November.
“This latest decline could be attributed to decreased U.S. trucking and freight exercise, with container ship arrivals on the Port of Los Angeles plummeting by roughly 32 p.c, in accordance with port knowledge,” the analysts mentioned in that be aware.
“We consider this marks the height of commerce challenges and anticipate an enchancment in container ship volumes within the coming weeks,” they added.
Stock Rise
The J.P. Morgan analysts went on to state in that analysis be aware that seen OECD business oil shares within the third week of Might rose by 12 million barrels, with crude oil shares rising by eight million barrels and oil product shares climbing by 4 million barrels.
“Month to this point, OECD business oil shares have collected by 28 million barrels, marking a major construct in Might, following a 19 million barrel draw within the first quarter of 2025 and a 5 million barrel attract April,” the analysts said within the be aware.
“Globally, whole liquid shares elevated by 29 million barrels within the third week of Might, following a 32 million barrel rise the earlier week. Crude oil shares noticed a considerable improve of 27 million barrels, whereas observable oil product shares grew modestly by two million barrels,” they added.
“Month to this point, international liquid shares have surged by 61 million barrels, largely pushed by a 66 million barrel surge in crude oil shares. Excluding China, international shares have risen by 40 million barrels up to now in Might, with a 36 million barrel improve in crude oil shares and a 4 million barrel rise in oil product shares,” the analysts continued.
To contact the writer, e-mail andreas.exarheas@rigzone.com
