fuel consumption Archives - Iran News Daily

Over 10% rise in oil prices due to fuel demand rising

reporter 1222 — Thu, 30 Apr 2020 09:04:52 +0000

TEHRAN (Iran News) – Oil prices jumped on Thursday following reports that US crude stockpiles increased less than expected and that gasoline demand battered by coronavirus restrictions is beginning to rise.

US benchmark West Texas Intermediate went up approximately 14.3% to $ 17.35 a barrel in Asian morning trade, after rising over 30 percent on Wednesday.

Brent crude, the international market, increased by 10.3% percent to $24.87 a barrel.

This comes after a sharp decline in oil prices in recent weeks as demand decreased because of global lockdowns caused by a massive supply, leading to storage capacity filling up.

US Energy Information Administration data on Wednesday showed US crude inventories had a rise of 9 million barrels last week reaching 527.6 million barrels, which was well under the 10.6 million-barrel increase analysts surveyed by Reuters had projected.

The data also showed US gasoline stockpiles went down by 3.7 million barrels from the previous week’s record highs, with a slight increase in fuel demand which offset a rebound in refinery output.

Analysts argue that the market now, despite being still volatile, appears to have found a floor.

“I think we’re closer to an equilibrium price for WTI between $15 and $20. That reflects all of the known knowns – the demand destruction that has led to storage filling up and pending supply cuts,” said Michael McCarthy, chief market strategist at CMC Markets and Stockbroking in Sydney.

“In the current environment, the market appears desperate for any positive signs, no matter how mild they seem. The focus this week has been on inventory and demand numbers from the US,” ING’s head of commodities strategy Warren Patterson said.

Patterson also said that “If we see a continuation of this trend in the coming weeks, it could suggest the worst might be behind the oil market.”

Edward Moya, the senior market analyst with OANDA, said the bounce in prices are the result of traders betting that “demand will continue to improve and as global production levels are forced lower as storage capacity runs out”.

A deal clinched by major producers to slash output by almost 10 million barrels is due to come into effect from Friday.

Also, some countries appear to have already begun cutting production in line with the deal, giving further support to prices.

Meanwhile, the International Energy Agency (IEA) said on Thursday that global energy demand could plummet by a record 6% in 2020 because of economic lockdowns from the coronavirus pandemic.

The post Over 10% rise in oil prices due to fuel demand rising appeared first on Iran News Daily.

Iran’s fuel consumption decreased in 18 months

reporter 1222 — Tue, 21 Jan 2020 06:42:28 +0000

TEHRAN (Iran News) – Iran’s managing policies succeeded to reduce domestic fuel consumption by over nine billion liters in the past 18 months, said the head of the Headquarters to Combat Smuggling of Goods and Foreign Exchange.

In an address to a press conference on Monday, Ali Moayedi-Khoramabadi, added diesel accounted for 90 percent of the decrease in fuel consumption in this period, IRNA reported.

He noted that in the past few years, diesel has become a lucrative commodity for smugglers.

Fighting rampant fuel smuggling to neighboring countries has always been a serious concern for Iran, which has some of the world’s cheapest fuel prices due to heavy government subsidies.

In a bid to curb fuel – particularly gasoline – smuggling from the country, on November 15, Iran introduced gasoline rationing and price hikes with Mohammad Baqer Nobakht, the head of the country’s Plan and Budget Organization, saying that the revenue would be used to increase the amount of monthly subsidies granted to 18 million needy families.

Following the Iranian government’s announcement, Iran’s fuel consumption declined to 75 million liters per day from 95 million liters per day, IRNA reported.

Moayedi-Khoramabadi noted that US unilateral sanctions, imposed on Iran following Washington’s withdrawal from a 2015 nuclear deal between Tehran and six major powers, have had an impact on goods and foreign currency smuggling from the country.

“However, we have made efforts to prepare the ground in such a way as to prevent smuggling of basic goods from the country.”

The official noted that smuggled items worth over $2.26 billion have been discovered and seized since the beginning of the current Iranian calendar year (started March 21, 2019), indicating a significant rise compared to the figure for the same period last year.

“In the area of combatting fuel smuggling, we managed to focus on main networks and arrest a key player thanks to efforts by Iran’s Judiciary and the intelligence organization of the Islamic Revolution Guards Corps. In this case, it was proved that hundreds of million liters of fuel had been smuggled from the country. Over the past few days, the final verdict was issued regarding the case and the culprit was given a $34.52 million fine.”

The official put at 86,000, valued at $2.14 billion, the number of smuggling cases being pursued by Iran’s judicial system since March 2019.

The Iranian government, he said, seeks to root out smuggling in Iran by setting up systems to this end.

The post Iran’s fuel consumption decreased in 18 months appeared first on Iran News Daily.