The price of crude oil continues to be quite volatile without finding a real trend: yesterday it exceeded $73/b before dipping below $71/b and then rising to $72/b. Prices took a temporary dip after China announced that it had drawn (for the first time) on its strategic reserves to calm the price rise. This announcement probably refers to the release of 22mb of crude oil to domestic refineries in July, but the news remained unofficial at the time. Importantly, the official statement suggests that China may be drawing on its strategic reserves again to calm prices.
In the US, crude oil stocks fell by 1.5mb and product stocks by even more for a total of over 10mb. The impact of Hurricane Ida has been very strong on production and refinery activity. For more details see our report here.
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Prices remain under pressure as the situation in the Gulf of Mexico is slow to normalise. The US is also drawing on its strategic crude oil reserves to make up for a production shortfall that remains 75% below its usual levels in the region.