Oil Down as IEA Cuts Demand, U.S. Crude Stocks Balloon


   
Barani Krishnan
DTN Refined Fuels Market Reporter

   SECAUCUS, NJ (DTN) -- Oil futures fell on Thursday (2/12) after the 
International Energy Agency (IEA) cut its forecast for crude consumption in 
2026.

   Adding to the bearish market mood was a large weekly rise in crude and 
gasoline stocks reported by the U.S. Energy Information Administration (EIA) on 
Wednesday (2/11).

   The Paris-based IEA lowered its 2026 demand growth forecast to 850,000 bpd 
in its February report, versus the 930,000 bpd projected in January. The agency 
cited high crude prices and economic uncertainty for the weaker outlook, as it 
maintained its projection of a 3.7 million-bbl market glut for the year.

   The IEA's outlook is closely watched as demand for oil has steadily 
slackened over the past year, leading to an outsized surplus in supply. 
Shifting macroeconomic conditions are also continuing to pressure global energy 
consumption.

   On the U.S. inventory front, crude stocks jumped by 8.5 million bbl to 428.8 
million in the week to February 6, according to the Washington-based EIA. The 
surge reversed a 3.5 million bbl decline from the prior week, when Winter Storm 
Fern cut domestic production by nearly 2 million bpd.

   U.S. gasoline balances rose for the 13th consecutive week, increasing by 1.2 
million bbl to 259.1 million as winter weather continued to suppress national 
driving demand. Distillates were the only bright spot in the EIA report, with 
an inventory decline of 2.7 million bbl to 124.7 million, after the prior 
week's increase of 300,000 bbl.

   U.S. President Donald Trump also eased market concerns over the safety of 
petroleum cargoes in the Middle East by telling a news conference at the White 
House that he preferred diplomacy over force in trying to get Iran to dismantle 
its nuclear program. Prior to this, Trump had threatened OPEC's fourth-largest 
exporter Iran with the possibility of military strikes as U.S. warships took 
positions in the waters of the oil-rich Middle East.

   NYMEX WTI crude futures for March delivery settled down $1.77, or 2.8%, at 
$62.84 bbl.  The ICE Brent crude contract for April closed down $1.88, or 2.7%, 
at $67.52 bbl.

   March RBOB futures contract fell $0.0587 to $1.9202 gallon. The front-month 
ULSD contract eased by $0.0431to $2.3973 gallon.

   The U.S. Dollar Index rose by 0.129 points to 96.80 against a basket of 
currencies.




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