WASHINGTON (DTN) -- The U.S. and international crude benchmarks along with ULSD futures on the New York Mercantile Exchange and Intercontinental Exchange advanced in afternoon trade Wednesday amid reports the European Commission moved forward its target date for expanded access to COVID-19 vaccinations to as early as this summer. This is seen as boosting economic and demand growth in the 23-nation bloc, while upbeat economic data released overnight suggest Eurozone's economy is well positioned for a much-anticipated rebound in the second half of the year.
According to new estimates, most Europeans will have access to a COVID-19 vaccine by late June -- three months earlier than initially estimated by the European Commission. The news comes as European governments accelerate efforts to boost domestic manufacturing of vaccines, in particular the Pfizer/BioNtech vaccine.
"We believe that on the basis of this, we will have enough doses to reach very important target of about 70% of the adult population within next three months," said EU Commission spokesman Stefan De Keersmaecker according to the Associated Press.
So far, only about 9% of EU citizens have received at least one shot of a vaccine compared with 26% in the United States and 27% in Britain, according to figures from Bloomberg Vaccine Tracker.
The upbeat vaccine forecast for the Eurozone amplified upgraded economic projections by the International Monetary Fund to send oil and equity markets modestly higher in afternoon trade Wednesday. Global economic growth is expected to reach 6% this year, according to projections from IMF, powered by progress in vaccination efforts and unprecedented fiscal stimulus measures in some large economies.
Earlier in the session, oil futures bumped higher on upbeat economic data for the Eurozone, showing business activity expanded for the first time in six months as a renewed upturn in the service sector coincided with record growth in manufacturing production.
Wednesday's inventory report showed a mixed picture for the U.S. petroleum complex, with production falling sharply from the previous week and refinery runs edging up a modest 0.1% compared with expectations for a more robust reading ahead of busier driving activity anticipated for the spring and summer months. Missing calls for a modest draw, gasoline stockpiles built by a massive 4 million barrels (bbl) last week to 234.6 million bbl -- the highest level of inventory on hand since the week ended Feb. 26. Demand for gasoline, meanwhile, declined in line with lower traffic activity during the week leading up to Easter weekend, down 110,000 barrels per day (bpd) to 8.781 million bpd. This contrasts with the first week of April 2020 when U.S. gasoline demand reached its pandemic nadir at 5.065 million bpd, as the first wave of infections and nationwide lockdown severely curtailed mobility.
Demand for distillate fuels declined a steeper 449,000 bpd from the previous week to below 4 million bpd at 3.664 million bpd. Earlier this week, EIA lowered its 2021 distillate demand projections to 4.05 million bpd despite seeing higher economic growth this year.
On the bullish side, U.S. crude oil inventories fell a larger-than-expected 3.5 million bbl from the previous week to 498.3 million bbl, about 3% above the five-year average. The draw was a second consecutive decline following five straight weeks with a stock build exacerbated by extreme weather in February, easing concerns over glutted domestic inventories. Additionally, domestic crude production unexpectedly dropped 200,000 bpd from the previous week to 10.9 million bpd after a three-week stretch of back-to-back gains.
On the session, NYMEX May West Texas Intermediate futures advanced 44 cents to settle at $59.77 bbl and the June Brent contract on ICE gained 42 cents to finish just above $63 bbl. NYMEX May ULSD futures added 1.38 cents to $1.8079 gallon and NYMEX May RBOB futures fell 1.45 cents to $1.9518 gallon.
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