WTI crude closed relatively flat yesterday even in the face of bearish inventory news reported by the EIA. A massive increase in crude stocks could not dampen the optimism generated by the beginning of the rollout of the coronavirus vaccine to the public. Crude is up in early trading this morning as vaccine optimism continues.
The United Kingdom began the rollout of its vaccine program on Tuesday. All eyes are on the UK program as it is the first among Western nations to begin administering the coronavirus vaccine to its citizens. Some allergic reactions have been reported, but overall the rollout has been successful.
Yesterday, Health Canada announced the approval of the Pfizer-BioNTech vaccine for use in Canada. “The data provided supports favourably the efficacy of Pfizer-BioNTech COVID-19 vaccine as well as its safety,” the department said in its report authorizing use of the vaccine in Canada for people over the age of 16. They expect about 249,000 doses to be available by the end of the year.
The same Pfizer-BioNTech COVID-19 vaccine is going through emergency FDA approval in the US. Experts expect the approval and distribution of the first doses of the vaccine in the US before the end of the year. The market is closely watching the vaccine rollout and is hopeful that the vaccine will help the economy and fuel demand to return to a semblance of normalcy.
The EIA reported a surprise increase for crude of 15.2 MMbbls, compared to an expected decrease of 1.4 MMbbls. A record surge in net imports was at the heart of the increase as imports rose and exports plunged. At Cushing, the EIA reported that stocks decreased by 1.4 MMbbls. US crude oil inventories are about 11% above the five-year average for this time of year. Distillates reported a build and continue to trend roughly 11% above the five-year average. Gasoline inventories had a build and are about 5% above the five-year average.
Crude prices are up this morning. WTI Crude is trading at $47.25, a gain of $1.73.
Fuel is up in early trading this morning. Diesel is trading at $1.4485, a gain of 5.0 cents. Gasoline is trading at $1.3238, a gain of 4.8 cents.