Historic Oil Glut Amassed During the Pandemic Has Almost Gone

The unprecedented oil reserves that were formed during the coronavirus pandemic crisis have almost disappeared, Bloomberg reports.

As of February, less than one fifth of the accumulated fuel volumes remained in storage, the data from the International Energy Agency (IEA) shows. Since then, balances have shrunk even more. According to the IEA, in July 2020, at its peak in storage facilities around the world were placed 249 million barrels more than the average for 2015-2019, and in February this surplus fell to 57 million barrels, the agency explained.

The decline in inventories followed a rebound in fuel demand and higher prices. Intercontinental Exchange reported that Brent oil closed trading on April 16 at $ 66.7 per barrel. Russia, Saudi Arabia and other OPEC countries reduced production by 10% in comparison with the pre-crisis level and only in early April they agreed for the first time in 2021 to start increasing production in May, June and July. The rise in oil prices is pleasing to fuel producers and suppliers, but increasingly worries car owners and governments fearing inflation.