- Oil prices have been under heavy selling pressure amid a coronavirus resurgence that is causing governments to curb travel
- China’s government has imposed new restrictions on movement to fight against the highly contagious delta variant
- US oil inventories surprised analysts who were expecting a withdrawal on Wednesday; adding to the downward price pressure
- China Impact:
- Flights in China have recently plummeted by a third (Bloomberg)
- Departures from 20 of the biggest Chinese airports have fallen to just 44% of the pre-pandemic level as of August 4
- China’s twelfth largest airport in Nanjing, the center of the outbreak, has canceled all of its flights since the city went into lockdown on July 23
- The new wave of Covid-19 outbreaks are also impacting road traffic
- The government has restricted public transport and taxi services in 144 of the worst-hit areas nationwide
- US crude oil stocks unexpectedly increased last week by 3.63 MMBbl, according to the EIA data released on Wednesday
- A decline in gasoline stockpiles gave bulls something to cheer, falling 5.3 MMBbl compared to an estimated draw of 1.5 MMBbl from the Bloomberg survey