US officials estimated today that around 1.5 million barrels per day has been removed from the market due to Russian sanctions. That's been counteracted to some extent by the US SPR releasing 1 mbpd.
But there are other factors in play as well. Libyan blockades are taking out 0.5 mbpd and the covid reopening is boosting driving and airline travel demand.
The big x-factor though is China where Shanghai remains on lockdown. How much oil demand is that keeping away?
The market is worried that the drag is worsening and there's no visible scope for China ending its covid-zero policy. China consumes 14 million barrels per day and a good chunk of that is at risk.
I think the technicals will tell the tale from here. Support at $93.52 needs to hold. There's still some breathing room but the chart pattern will be resolved in the next couple weeks.
