US EIA weekly crude oil inventories
- Prior was +1177K
- API inventories showed a drawdown of 1900K
- Gasoline +786K vs +1750K exp
- Distillates +4998K vs +2250K exp
- Refinery utilization -1.4% vs +0.5% exp
- At Cushing +423K vs +725K
It looks like what was happening at Cushing threw off analysts but once again the API numbers were the tell.
What the market is expecting changes after the API numbers. The 'consensus' at +1300K would have been closer to -500K after the API report. That's a big reason why oil was up 81-cents to $38.31 ahead of the EIA data. Still, this is a bigger drawdown even if the distillates number takes a bit of the shine off.
More and more market watchers are taking about the possibility of maxing out US crude storage this year and millions of barrels of oil being dumped on the market. The high level of chatter is perhaps a sign that the bearish sentiment has gotten a bit out of hand. With year-end near as well, I think the balance of risks might be starting to tilt to the upside.
