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An unexpected drop in crude oil inventories has pushed US crude to a seven-month high, as the supply glut has energy firms cutting production.
The price increase, closing in on $49/barrel, is part of a continuing rally since January’s $30/barrel low—a rally that some speculate is bound for an about face in the near future, the Wall Street Journal reports.
US crude stockpiles decreased by 4.2 million barrels last week, while analysts asked by the Wall Street Journal expected a decrease of just 2.5 million barrels.
Reis economist Barbara Denham told Bisnow in April the oil slump’s direct impact on real estate has been minimal, although analysts were keeping an eye on office vacancies in Houston in particular.
If the upswing continues, oil-dependent office space won’t have to worry—and the rock-bottom oil prices have actually been a boon to industrial space on the whole, which is seeing some of its hottest conditions in 35 years.
“In general the lower prices for oil are good for everybody else,” Colliers’ national director logistics Jack Rosenberg told us in March. “If transportation is half the cost, it drives down the cost of supply chains.” [WSJ]
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