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US CPI Data Could Provide Support to Oil Demand Outlooks

OIL
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Today’s CPI data showed US price rises eased in April, supporting hopes of rate cuts this year, and thus bullish for future oil demand.

  • Core CPI At 4.0% and Supercore At 6.5% Over Six Months.
  • contained dovish reaction in FOMC-dated OIS as CPI data prints inline to a touch softer than expected and the retail sales control group comes in on the soft side, coupled with a negative revision.
  • Argus noted that the energy index rose by 2.6% over the 12 months ended in April, accelerating from 2.1%. However, the gasoline index eased on an annual basis to 1.2% in April, compared to 1.3% previously.
  • While gasoline prices and cracks were elevated in April, demand has been seasonally weak, with the typical boost in driving demand in the run-up to the summer failing to materialise. This has helped to keep a lid on price rises.
  • A return of refineries after a heavy maintenance season is also supportive on the supply side, helping to limit price gains.
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Today’s CPI data showed US price rises eased in April, supporting hopes of rate cuts this year, and thus bullish for future oil demand.

  • Core CPI At 4.0% and Supercore At 6.5% Over Six Months.
  • contained dovish reaction in FOMC-dated OIS as CPI data prints inline to a touch softer than expected and the retail sales control group comes in on the soft side, coupled with a negative revision.
  • Argus noted that the energy index rose by 2.6% over the 12 months ended in April, accelerating from 2.1%. However, the gasoline index eased on an annual basis to 1.2% in April, compared to 1.3% previously.
  • While gasoline prices and cracks were elevated in April, demand has been seasonally weak, with the typical boost in driving demand in the run-up to the summer failing to materialise. This has helped to keep a lid on price rises.
  • A return of refineries after a heavy maintenance season is also supportive on the supply side, helping to limit price gains.