US oil demand hits record highs, adding to inflation surge
Oil prices continued to rise on Thursday as US demand hit record levels.
At 2:00 p.m. EDT (UTC-5) West Texas Intermediate on the New York Stock Exchange was selling at $ 72.50 a barrel, up 1.76%.
The four-week average oil demand hits an all-time high of 23.2 million barrels per day, about 20% above 2020 levels, meaning increased consumption of gasoline, diesel and other refined fuels, analysts said.
Analysts wrote that the surge in demand was due to more people traveling this holiday season and an increase in the number of trucks on highways delivering products.
Crude stocks are falling
The US Energy Information Administration published its weekly figures on Wednesday show crude exports are returning to normal and a larger-than-expected draw on domestic crude stocks.
U.S. crude inventories fell 4.6 million barrels in the week to December 10, according to EIA data, more than double the 2.1 million barrel drop predicted by the U.S. analysts.
Refinery production reached 23.2 million barrels per day, mainly due to an increase in the production of gasoline, diesel and other refined fuels.
Meanwhile, analysts said the Federal Reserve’s Federal Open Market Committee decision on Wednesday to end its purchases of Covid-era bonds in March and start raising interest rates in 2022 n ‘is unlikely to affect the continued demand for petroleum products.
Covid blocks price gains
On the other hand, concerns over the latest variant of the coronavirus have put downward pressure on oil prices, analysts say.
Omicron would quickly spread to the UK and South Africa. Companies around the world are once again requiring their employees to work remotely, which could lower the demand for oil.
“The trauma remains”
Commerzbank energy analyst Barbara Lambrecht said in an email that “trauma lurks” for the oil industry.
His prediction is that demand for oil will increase sharply, no further oil reserves are likely to be released, and the excess supply is expected to be significantly lower. .
Read more: Energy commodities rally after Fed announcement
Ready to start?
The difference between trading assets and CFDs
The main difference between CFD trading and trading assets, such as commodities and stocks, is that you don’t own the underlying asset when you trade a CFD.
You can still benefit if the market moves in your favor, or suffer a loss if it moves against you. However, with traditional trading, you enter into a contract to exchange legal ownership of individual stocks or commodities for cash, and you own it until you sell it again.
CFDs are leveraged products, which means that you only need to deposit a percentage of the total value of the CFD trade to open a position. But with traditional trading, you buy the assets for the full amount. In the UK there is no stamp duty on CFD trading, but there is when you buy stocks, for example.
CFDs come with overnight costs to hold trades (unless you’re using 1 to 1 leverage), making them more suitable for short-term trading opportunities. Stocks and commodities are more normally bought and held longer. You could also pay a commission or brokerage fees when buying and selling assets directly and you would need a place to store them safely.
Capital Com is an execution-only service provider. The material provided on this website is for informational purposes only and should not be construed as investment advice. Any opinion that may be provided on this page does not constitute a recommendation of Capital Com or its agents. We make no representations or warranties about the accuracy or completeness of the information provided on this page. If you rely on the information on this page, you do so entirely at your own risk.