Crude oil, energy stocks slide on signs of slowing U.S. fuel demand
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Energy (NYSEARCA:XLE) brings up the rear in Thursday's sector standings, -2.7%, with crude oil futures falling sharply as investors weighed signs of slumping U.S. gasoline demand and the return of supplies from Libya.
U.S. WTI crude oil (CL1:COM) for September delivery -2.8% to $97.04/bbl while September Brent crude (CO1:COM) -2.1% to $104.64/bbl.
Among the biggest decliners in the oil and gas group: (BKR) -7.1%, (VLO) -6.4%, (HAL) -5.6%, (APA) -4.9%, (MRO) -4.5%, (SLB) -4.5%.
ETFs: (NYSEARCA:USO), (UCO), (SCO), (USL), (DBO), (USOI), (NRGU), (OILK), (OLEM), (XOP), (VDE), (OIH), (IEO), (DRIP), (CRAK)
Crude and product futures added to declines after the Energy Information Administration reported U.S. gasoline inventories unexpectedly rose by 3.5M barrels last week compared to the consensus forecast for a rise of 400K barrels, even as refinery runs fell to 93.7% last week from 94.9% a week ago.
Pointing to a sign that high prices may be causing demand destruction, Sevens Report Research said gasoline supplied, a measure of implied demand, only bounced by 459K bbl/day to 8.52M bbl/day last week after plunging 1.35M bbl/day in the previous week, which was the largest drop since the initial COVID lockdowns.
Meanwhile, Libya said Wednesday that crude production had resumed at several oilfields after lifting of force majeure on oil exports last week, with output expected to return to 1.2M bbl/day within 10 days.
Kinder Morgan (KMI) is one of the day's few gainers in the energy sector, +1.1%, after beating Q2 earnings estimate and foreseeing full-year adjusted EBITDA coming in favorably to its budget by 5%.