US Oil Weekly Update: A Short-lived Rally

Donald Trumps decision to pause some tariffs sparked a rally in crude oil prices yesterday. Ignoring higher than expected US inventory build from the EIA report, West Texas Intermediate shot up above $60 and settled at $62,5 by closing time. WTI shaves off some of the gains from Wednesday in todays trading session but still above the $60 mark.

The uncertainties still linger in the market, with rising output from OPEC+ and a weaker demand outlook globally. US tariffs and escalating trade tensions with China has put crude oil under pressure due to recession fears.

Yesterday’s rally seems short lived, with parts of futures curve in a bearish contango we expect to see lower prices to come.

Figure 1. West Texas Intermediate the Last Five Days.

US Crude inventories and production.

US commercial crude oil inventories increased by 2.6 million barrels in the week ending April 4, with market forecasters predicting between 2 and 2.2 million barrel-decrease in crude stocks. U.S. commercial crude oil inventories are about 5 percent below the five-year average for this time of year and 14.9 million barrels lower than a year ago. U.S. crude oil refinery inputs averaged 15.627 million barrels per day during the week ending April 4, 2025, 69 000 bpd more compared to the previous week`s average. Refineries operated at 86.7 percent of their operable capacity last week.

Figure 2. US Crude Stocks including SPR at 839.1 million Barrels.

Figure 3. US Crude Stocks Excluding SPR at 442.3 million Barrels.

US Rig Activity.

The total number of active rigs operating in the US according to Baker Hughes rig count decreased by two last week, currently at 590. Oil focused rigs increased by five last week, at 489 active rigs. Gas focused rigs decreased by seven, now at 96 active rigs. Miscellaneous was flat last week still at five active rigs.

Figure 4. Active Oil Focused Rigs Decreased by Two Last Week now at 489

Figure 5. Gas Focused Rigs decreased from 103 to 96 Active Rigs.

Figure 6. Total Active Rigs in the U.S. Decreased by Two Last Week, now at 590.

Figure 7. Rig Count in Major Basins.

Baker Hughes has issued the rotary rig counts as a service to the petroleum industry since 1944, when Baker Hughes Tool Company began weekly counts of U.S. and Canadian drilling activity. Baker Hughes initiated the monthly international rig count in 1975. The North American rig count is released weekly at noon Central Time on the last day of the work week.

By the Numbers April 10, 2025.

Disclaimer

This report is under no circumstances intended to be used for or considered as investment advice. This report is to be used as information and general market guidance. The author, GE Briefings and Investornytt cannot guarantee that the information from sources is without incentives, but the author has taken considerable care to ensure that, and to the best of his knowledge, material information contained in the report is in accordance with the facts and contains no omission likely to affect its understanding. Please note that this report is the author’s own research, opinions and conclusions, and the readers are recommended to draw their own conclusions based on other sources than this report, the facts and market picture can change in an instant and therefore the reader must do their own due diligence. The author, GE Briefings and Investornytt cannot be held responsible for the readers investments based on this report.

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