Oil prices are experiencing renewed selling pressure. Brent is trading well below the $50 per barrel mark again, while WTI actually fell overnight to a 6½-year low of $41.3 per barrel. As a result, the price differential between the two oil types has widened to more than $7 per barrel, which was last the case in early May. The poorer price performance of WTI in recent days can be explained by the outage of a crude oil processing facility in the US Midwest's largest refinery due to repair work. As a result, processing capacities of 240,000 barrels per day are out of operation. If all other parameters were to remain the same - i.e. processing in other refineries, imports and production - this would see crude oil stocks rising by approximately 1.7 million barrels in a week's time, says Commerzbank.



Consequently, this week's inventory reduction will presumably be significantly lower than in the preceding weeks. The repair work is expected to take at least a month, by which time the summer driving season will have come to an end and refineries will be scaling back their operation due to the then declining demand and maintenance work. It is therefore perfectly conceivable that the usual seasonal inventory build will begin earlier this year, adds Commerzbank. Despite inventories having been continually reduced since May, US crude oil stocks are still at the very high level of just short of 100 million barrels above the long-term average.