5-11-21 RCC Energy Market Update

Much of today’s market focus was on the Colonial Pipeline and supply concern.  In some southern states supply was running dry and pump prices rose, causing panic buying by motorists.  The Biden administration projected that the Colonial Pipeline would restart in a few days and has been urging drivers not to top off their tanks.  The U.S. Department of Transportation (DOT) on Tuesday said it is investigating a “a temporary and targeted waiver” of federal rules that make shipborne transfers of fuel between U.S. port more expensive in an attempt to ease the impact of the Colonial Pipeline shutdown.  OPEC raised its forecast for demand for its crude by 200,000 bpd and stuck to its prediction of a strong recovery in global oil demand this year as growth in China and the United States counters the coronavirus crisis in India. To continue with the bullish sentiment, for crude, analysts are expecting data to show U.S. inventories fell by about 2.3 million barrels in the week to May 7 after a drop of 8 million barrels the previous week, a Reuters poll showed. Gasoline stocks are expected to have fallen by about 400,000 barrels, analysts estimated ahead of reports from the American Petroleum Institute later today and the U.S. Energy Information Administration on Wednesday.