While bearish oil traders kept their focus on the supply side of oil, many forgot to focus on the demand side and it is the demand side that propelled oil back to a three-week high yesterday. That put oil back to the highest level since the big stock market correction drop. The catalyst was an unseasonal 1.16 million barrel drop in crude supply and continued to rip roaring demand.
Gasoline demand increased by 222k barrels last week and has averaged 9.1 million barrels a day, which is up 5.4% from year ago levels. That is a sign that consumers are feeling strong and are out driving and spending money.
Overall total oil products demand is averaging a very healthy 20.6 million barrels per day, up by 4.3% from the same period last year. Distillate demand has averaged 4.1 million barrels per day over the last four weeks, up by 4.3% from the same period last year. Jet fuel demand is also surging and is up a whopping 6.7%, compared to the same four-week period a year ago.