Nigeria isn't enough to continue to push crude oil prices higher due to current ample supplies in the U.S.. Gasoline inventories remain above the upper end of the five-year range since early February.
The IEA release is obviously a bearish factor, a large portion of which consists of crude oil. Given the capacity constraints, the effect of additional barrels of crude oil seems limited and the amount of gasoline will be insufficient to ease current supply tightness.
Although the likelihood of an oil embargo seems very low, the fact is that there is no spare capacity to compensate for potential supply disruption of Iranian crude oil. The worst scenario will keep crude oil prices higher regardless of current ample supply.
Given the capacity constraints, the effect of additional barrels of crude oil seems limited and the amount of gasoline will be insufficient to ease current supply tightness.
The latest energy department statistics were very bearish. Coupled with ample supply in crude oil and distillates, recent rapid recovery in gasoline inventories will continue to weigh on the market.