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Crude oil futures slipped for the second straight day on Thursday, weighed a bit by weaker U.S. gasoline demand data.
While domestic gasoline inventories fell for a seventh week, down 3.3M barrels to 230.8M, gasoline product supplied – a proxy for product demand – fell below 9M barrels, which indicates that rallying gasoline markets may have been overbought, according to Mizuho’s Bob Yawger.
Oil also may have been pressured by confirmation that the U.S. drafted a United Nations resolution calling for a ceasefire between Israel and Hamas in Gaza, Yawger said.
Also, the dollar rebounded as a surprise rate cut by the Swiss National Bank pared the benefit of the U.S. Federal Reserve maintaining its outlook for three rate reductions this year, which broader markets interpreted as dovish.
Traders are “wading through all of the conflicting sentiment from central banks over the last 24 hours, including the dovish Swiss central bank rate cut, the hawkish rate increase in Taiwan and the neutral-dovish sentiment from the Fed and the Bank of England,” SIA Wealth Management chief market strategist Colin Cieszynski told Marketwatch.
Crude prices finished with back-to-back losses after settling two days ago at their highest level since late October, with front-month Nymex crude (CL1:COM) for May delivery ending -0.2% to $81.07/bbl and front-month May Brent crude (CO1:COM) closing -0.2% to $85.78/bbl.
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Bank of America energy analysts said gasoline prices and refinery crack spreads could continue to rise as the high-demand summer season approaches, citing various factors including low stockpiles, reduced production, and no indications that Ukrainian attacks on Russian refinery infrastructures will ease.