After crude markets were getting support from China's growing demand, yesterday an increase in Chinese fuel prices is expected to cripple oil demand as prices fell massively yesterday. Prices of gasoline and diesel in China will jump by 18% starting from today. Despite the fact that their oil consumption that was reported in June 10 is projected to increase by 440,000 barrels to an average of 8.02 million barrels a day this year, still there are worries that demand would still dampen due to price increase. The contract shed $4.57 as it closed at $132.60 while recording a high of $138.36 per barrel and a low of $132.09 per barrel.
As China is known to be the world's second biggest energy consumer after the U.S while the hike in prices since 8 months is still in affect today. Prices remain steady above the $132 per barrel as fears still overcome the market of lower demand from china. Today the markets opened at $132.41 while recording a high of $132.94 per barrel and a low of $131.75 per barrel.
Looking back at Wednesday when the EIA report was released showing that the U.S. commercial crude oil inventories decreased by 1.2 million barrels from the previous week. At 301.0 million barrels, U.S. crude oil inventories are at the lower boundary of the average range for this time of year. Total motor gasoline inventories decreased by 1.2 million barrels last week, and are in the lower half of the average range. Finished gasoline inventories increased last week while gasoline blending components inventories decreased during this same time. Distillate fuel inventories increased by 2.6 million barrels, and are in the lower half of the average range for this time of year.
With Saudi Arabia scheduled to meet Sunday in order to discuss its current output in order to increase production so prices can ease prices further have every investor's attention currently. This decision of either increasing output or if they feel there is no need for more pumping of crude in the ma