HomeUS Oil Demand Hits New High

US Oil Demand Hits New High

US oil demand has reached a new record, with petrol and diesel demand returning to pre-pandemic levels. Commodities also outperformed in H1 2021.

The start of the trading week brought a decline in the crude oil price. It was the first significant correction in a while, and the move lower triggered a correction in the equity markets, too. Elsewhere, safe-haven currencies like the Japanese yen strengthened.

But the price of oil recovered and has moved back above $70 again. It is unlikely that the  correction will last, given the fact that in July US oil demand reached a record high on a seasonally adjusted basis.

Diesel and petrol demand is back to pre-pandemic levels, and the outlook remains rosey. Other commodities also enjoyed a bump this month.

Commodities – The Top Performer in First Half of 2021

Major asset classes outperformed during the first half of the trading year. They delivered a 21% return over the period, much higher than US equities (15%), world equities (13%), emerging markets (8%) and US Treasuries (-3%).

A detailed analysis of the sector reveals that the WTI crude oil price was the strongest performer – up over 50% in the first six months of the year. Strong demand as the world’s economy recovers from the pandemic is responsible for the rise in oil prices.

Corn comes in a close second, delivering over 30% in H1 2021. Natural gas, iron ore and copper gained over 20% as well.

Precious metals had a mixed performance. On the one hand, palladium delivered a 15% return, but on the other hand, silver and gold delivered negative returns.

After the remarkable turnaround from negative territory, the price of oil should remain bid on strong demand, and the US economic growth will likely expand further.

One indication of the strong demand for oil comes from the number of people that flew in the US. At the start of the month, the number was greater than on the same day in 2019, before the pandemic.

Join the Social Trading revolution. Connect with other traders, discuss trading strategies, and use our patented CopyTrader
eToro is the world’s leading social trading platform, offering a wide array of tools to invest in the capital markets
Largest number of currency pairs to trade
Open my Account

We use cookies to personalise content & ads, provide social media features and offer you a better experience. By continuing to browse the site or clicking "OK, Thanks" you are consenting to the use of cookies on this website.