Lower In Asia As Potential For Largest-Ever U.S. SPR Release In Focus

WTI is ~-$6.00 and Brent is ~-$5.20, operating around the session’s worst levels at writing. Both benchmarks have tumbled past Wednesday’s lows on BBG source reports of the Biden administration considering a sizeable release of crude from the U.S. SPR, with the report detailing plans to “release roughly a million barrels of oil a day”, totalling “as much as 180 million barrels”. Looking ahead, U.S. President Biden is expected to deliver remarks re: the plan later on Thursday.

• Turning to China, demand worry re: pandemic control measures remains elevated, as COVID case counts for Mar 30 show overall fresh daily infections hovering at recent highs. Official Chinese Mar PMI data crossing earlier in the Asian session also pointed to contractions in manufacturing and non-manufacturing activity as both metrics have fallen below the 50-mark, although major oil benchmarks were little changed on the release.
• Elsewhere, OPEC+ ministers will meet later on Thursday, with RTRS source reports on Wednesday suggesting that the group will likely stick to previously mentioned cumulative output increase targets (400K bpd).
• Weekly U.S. EIA data released on Wednesday saw a surprise build in gasoline and distillate stocks, while there was a larger than expected drawdown in crude inventories, with Cushing hub stocks declining as well. The data release runs somewhat counter to Tuesday’s reports re: weekly API inventory estimates, with those reports having pointed to drawdowns across all inventories.