US oil, gasoline stockpiles fall: EIA

Under construction offshore oil platform rigs in Port Fourchon, Louisiana. (AFP)
Updated 21 June 2017

US oil, gasoline stockpiles fall: EIA

NEW YORK: US crude oil and gasoline stockpiles fell last week, while distillate inventories rose, the Energy Information Administration (EIA) said on Wednesday.
Crude inventories fell 2.5 million barrels in the week to June 16, surpassing analysts’ expectations for a decrease of 2.1 million barrels, as imports rose marginally by 56,000 barrels per day (bpd).
Crude stocks at the Cushing, Oklahoma, delivery hub for US crude futures fell by 1.08 million barrels, EIA said.
The price gains in the report’s immediate aftermath were hard to sustain because they were not structural changes said Abhishek Kumar, Senior Energy Analyst at Interfax Energy’s Global Gas Analytics in London.
“US crude and gasoline stockpiles are significantly higher compared with their five-year averages, which will weigh on prices,” Kumar said. “Meanwhile, oil output in the country is still rising despite recent declines in oil prices.”
US crude production has been steadily growing and last week rose to 9.35 million bpd, up 20,000 bpd from the previous week, the EIA said.
Gasoline stocks fell 578,000 barrels, compared with analysts’ expectations for a seasonally unusual 443,000-barrel gain, which had been seen as bearish in the market. Stocks of the motor fuel had also risen unexpectedly by 2.1 million barrels in the previous week, despite the start of the summer driving season.
“Gasoline demand rebounded smartly to more normal levels for this time year, giving credence to the view that some of the lackluster demand was weather-related,” said John Kilduff, a partner at Again Capital Management.
Distillate stockpiles, which include diesel and heating oil, rose 1.1 million barrels, versus expectations for a 465,000-barrel increase, the EIA data showed.
Refinery crude runs fell by 104,000 bpd as utilization rates fell 0.4 percentage point to 94 percent of total capacity, EIA data showed.


Mexico objects to labor enforcement provision in North American trade deal

Updated 5 min 1 sec ago

Mexico objects to labor enforcement provision in North American trade deal

  • Mexico produced more stringent rules on labor rights aimed at reducing Mexico’s low-wage advantage
  • US House of Representatives proposes the designation of up to five US experts who would monitor compliance with local labor reform in Mexico

MEXICO CITY: Mexico’s deputy foreign minister, Jesus Seade, said on Saturday he sent a letter to the top US trade official expressing surprise and concern over a labor enforcement provision proposed by a US congressional committee in the new North American trade deal.
Top officials from Canada, Mexico and the United States on Tuesday signed a fresh overhaul of a quarter-century-old deal, aiming to improve enforcement of worker rights and hold down prices for biologic drugs by eliminating a patent provision.
How labor disputes are handled in the new United States-Mexico-Canada Agreement (USMCA) trade deal was one of the last sticking points in the negotiations between the three countries to overhaul the agreement.
Intense negotiations over the past week among US Democrats, the administration of Republican US President Donald Trump, and Mexico produced more stringent rules on labor rights aimed at reducing Mexico’s low-wage advantage.
However, an annex for the implementation of the treaty that was presented on Friday in the US House of Representatives proposes the designation of up to five US experts who would monitor compliance with local labor reform in Mexico.
“This provision, the result of political decisions by Congress and the Administration in the United States, was not, for obvious reasons, consulted with Mexico,” Seade wrote in the letter. “And, of course, we disagree.”
USMCA was signed more than a year ago to replace the North American Free Trade Agreement (NAFTA), but Democrats controlling the US House of Representatives insisted on major changes to labor and environmental enforcement before voting.
The letter, released on Saturday, is dated Friday and addressed to US Trade Representative Robert Lighthizer. Seade said he would travel to Washington on Sunday to raise the issues directly with Lighthizer and lawmakers.
“Unlike the rest of the provisions that are clearly within the internal scope of the United States, the provision referred to does have effects with respect to our country and therefore, should have been consulted,” Seade wrote.
Both Canada and the US House Ways and Means Committee said the deal included a mechanism for verification of compliance with union rights at the factory level in Mexico by independent labor experts.
Some Mexican business groups bemoaned a lack of clarity and conflicting information on how the rules would actually be enforced under the deal, the first text of which became public only on Wednesday.