DTN Oil

WASHINGTON (DTN) -- Crude and refined products futures on the New York Mercantile Exchange and Brent crude traded on the Intercontinental Exchange settled Friday's session mixed, although all contracts notched better than 1.5% gains this week, spurred by the passing of President Joe Biden's $1.9 trillion spending package which is expected to boost economic growth in the second and third quarters, and easing of quarantine restrictions across large gasoline-consuming states.

Further fueling buying interest, an accelerated pace of daily inoculations in the United States indicates all citizens may be eligible for vaccines as early as May 1 -- months ahead of previous expectations. The country is now administering vaccinations at the rate of 2.2 million people a day, bringing the total number of shots administered to 98.7 million since the start of immunization program on Dec. 14. In his first primetime address to the nation Thursday night, Biden pledged the country could see a return to normalcy by July 4.

The accelerated pace of vaccinations joined by additional stimulus measures pushed the consumer sentiment index this month to the highest in over a year at 83.0.

"The gains were widespread across all socioeconomic subgroups and all regions, although the largest monthly gains were concentrated among households in the bottom third of the income distribution as well as those aged 55 or older," said Surveys of Consumers Chief Economist Richard Curtin.

This bodes well for U.S. gasoline consumption with driving demand improving as quarantine restrictions abate. Data released Wednesday by the Energy Information Administration shows the recovery is picking up pace, with U.S. gasoline demand jumping 578,000 barrels per day (bpd) in the first week of March to a four-month high 8.726 million bpd, a 7% increase from the previous week. Distillate demand during the week rose by about 700,000 bpd, and at 4.487 million bpd is now higher than levels seen this time last year.

Separately, Baker Hughes reported Friday domestic producers cut the number of operating oil and natural gas rigs for the second time this year even as prices soared to their highest point in over a year. At 309, the number of active oil rigs in the United States decreased one on the week while down 374 from the comparable week a year ago. Earlier this week, EIA forecasted domestic crude production would rebound to 11.1 million bpd this year after collapsing to about 10.4 million bpd last month as a result of Winter Storm Uri which affected much of the country, in particular Texas. Following recovery efforts, U.S. shale operators are forecasted to grow production by an additional 900,000 bpd next year to 12 million bpd -- just 200,000 bpd shy of the 2019 output rate. Revised production rates reflect higher crude prices for both 2021 and 2022.

On Friday, West Texas Intermediate for April delivery settled at $65.61 bbl and Brent May crude at $69.22 bbl, both down 41 cents on the session. NYMEX April ULSD futures gained 0.81 cents to $1.9675 gallon and April RBOB futures advanced 1.2 cents to a $2.15 gallon settlement, edging off a $2.1599 31-month high on the spot continuation chart.

Liubov Georges can be reached at liubov.georges@dtn.com