- Oil plunges further as the dollar strengthens and demand concerns mount
- May ’23 WTI lost $1.30 this morning to trade around $77.86/Bbl
- A Federal Reserve survey showed the U.S. economy stalled in recent weeks, with hiring and inflation slowing, and credit access narrowing
- However, the Fed is expected to hike interest rates again in May, which could hurt oil demand
- Additionally, the U.S. dollar continued to strengthen relative to its recent lows, making oil expensive for holders of other currencies
- Soaring inflation in Europe and economic data coming out of China are also weighing on oil prices this week
- Gasoline demand in Southeast Asia weakens during peak season (BBG)
- Crack spreads, or refining margins in Singapore, have more than halved since March to the lowest since December
- Stocks of fuels, including gasoline, are at their highest level for this time of the year since 1995
- Increased fuel exports from China are adding to the region's supplies, according to traders
- Despite weaker Southeast Asian markets, European demand for gasoline is resilient, India's demand for fuels is rising, and Chinese demand is also improving