The U.S. has seen several weeks in which the levels of crude oil sitting in storage have declined, falling from 80-year record highs. Inventories have dropped more than 10 million barrels since May, offering clues that suggest that the oil market is moving closer to a supply/demand balance.
Although the EIA storage figures are closely watched by oil analysts, a lesser known but similar metric from Saudi Arabia also indicates an oil market continuing to adjust. According to data from the Joint Organisations Data Initiative, and reported on by Bloomberg, Saudi oil inventories have declined for six consecutive months, the longest period of contraction since data collection began 15 years ago.
Saudi oil inventories have drawn down by 38.6 million barrels since October, taking storage down to 290.9 million barrels, a two-year low. The new Saudi energy minister Khalid Al-Falih told Bloomberg TV on June 2 that he sees “a balanced market.” He also said that Saudi Arabia has “started inventory drawdowns that will continue for the foreseeable future.”
By : oilprice.com