US Weekly Oil Summary: Panama Canal Delays Boost Diesel Exports to Europe

The US exports to diesel are at a record rate as delays at the Panama Canal shut out markets in the Pacific, according to BNEF.

• US crude inventories fell this week despite another unexpected drop in exports. Cushing stocks as expected rose again to the highest since mid-August.
• US oil and gas rig counts fell by 3 to 623 rigs, according to Baker Hughes latest data Dec. 15. US oil rig count declined by 2 to 501.
• The EIA Short Term Energy Outlook revised up US crude production for 2023 to 12.93m b/d, up 30k b/d from its forecast in November.
• USD: Despite a moderate recovery on Friday, the USD index sits around 1.35% softer on the week following a clearly dovish pivot from the Federal Reserve at the December meeting. Every element of the communications was more dovish than expected, spurring one of the biggest post-decision downward rate repricings and greenback sell-offs in years.
• The Federal reserve kept the Fed funds rate unchanged at 5.25%-5.5%, the highest rate since 2001. Fed officials expect to lower rates by 75 basis points next year, a sharper rate of cuts than implied in September’s projections.
• US Core CPI came in very much as expected in November at 0.285% M/M but Supercore (core services ex OER & rents) was slightly on the higher side at 0.44% M/M.
• Initial US jobless claims unexpectedly fell to 202k in the Dec 9 week, vs consensus that it would remain steady vs prior week at 220k (which was ultimately revised up to 221k).