Keystone XL is cancelled, a boon for US producers

Brent futures weakened on Wednesday, to reach 55.8 $/b for the prompt contract after surprise builds across all US inventories, reported by the API survey. The official data is due on Friday. President Biden advanced on several key climate policies as of yesterday with the US re-joining the Paris Agreement, while at the same time imposing a moratorium on Arctic E&P and denying the building permit for the Keystone XL pipeline, supposed to supply the US with Canadian crudes. Finally, crude prices in the Middle-East remained weak compared to the Dubai financial benchmark, a sign a crude buying from Asian customers is not picking up. Cold weather in Japan has effects on the nation’s oil stockpiles, as kerosene/heating oil demand skyrocketed, while utilities struggled to find fuel oil stocks to burn in their emergency oil-fired power plants.