Welcome back to our weekly EIA report, where we run through demand and supply data and give our cents on where we are heading next – and what the implications are for energy markets. 

As always we present the main conclusions up-front:

1) Oil demand will likely come in hot in November on the back of strong gasoline demand in October due to the lags in energy markets (Gasoline leads oil – not the other way around).

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September’s implied demand data took markets by storm with a print way lower than what one would normally expect in September, but as we rightfully forecasted back then, it was not at all in line with high-frequency data, which has become clear as day in this week’s report. Implied demand for gasoline jumped 18,3% compared to last month, while implied demand for diesel and oil keeps dropping (on a NSA basis). 

Our full decomposition of the EIA report below:

Chart 1: Big rebound in implied oil demand