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WTI Crude Pumps-And-Dumps As Increased Production Trumps Surprise Inventory Draw
Following last night's inventory build report from API, expectations adjusted to a 818k build for the DOE data this morning. However, for the 5th week in a row, DOE reported a draw (this time of 1.95 million barrels). WTI Crude had rallied into the data but was still in the red from yesterday's close and spiked on the inventory news. However, once the machines had a chance to see that production rose once again - to a new cycle record - prices began to slide....
5th weekly inventory draw...
But another jump in production to new cycle record highs...
and prices are now lower...
Charts: Bloomberg
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ZH is a site of pessimistic porn. It picks up any one day event, speculation and rumor and make a big fuss out of it. The authors never check back what they say and simply forget about it and go on to the next ghost story.
Sooooooooooooo,,,, one has to ask, why are you here?
Actually they check back quite often. The question should be "how long have you been here?" Kind of like someone writing a movie review only having seen the trailer.
Edit: I see just about two years, so the original question stands "Why are you here?"
I come in, pissed off, go away and come back in again and pissed off again for the last two years. I never see people correct their past mistakes. Off course, this is the same with most brainless analysts at any other place. The difference is that they are mostly optimistic.
Don't hate the player, hate the game. As you point out, no analyst is always right. Commentary can be insightful even while failing to hit the mark dead center on its prediction of the consequences.
Let me add that a certain oil stock did go from $8 to $15 in early May, and now trades $12.30 as of now. It was right to call a halt to the rally. And it's right to question whether autumn will see a resumption of builds and falling prices.
I’m here for the pessimistic porn. I just enjoy those who take EIA weekly data, put it on a graph, and then, apparently, believe it as if it were a fact. EIA weekly oil production data is fantasy, an estimate based on multiple guesses massaged by a computer program. There is absolutely no producer input, those who actually produce the stuff, involved in the generation of the weekly numbers. I find it humorous that anyone takes it seriously and that is why I keep coming back.
Surprise, Another suprise...
after july 4, seasonal weakness for oil prices begins.
Yep, the drawdown as a percentage of total crude inventory is very small and it is part of the normal seasonal draw. The problem is that refiners are working from historical average and the people who make the guess are rolling the dice. Unfortunately out here in the real world, people are just trying not to drown, so vacation season is gonna suck. I figure high 40's for Aug-Sept, with it sliding down into the 30's later......
Volatility in the OIL markets should not come as a surprise to anyone who has been following this analysis ...
http://www.globaldeflationnews.com/oil-light-sweet-crudeelliott-wave-upd...
The higher the price the more the supply, the more the supply the higher the price?
Inventory has been basically flat during the past few weeks, which are the peak of the summer driving refinery season. The draws have been less than 0.5% each week.
Is Cushing full yet? When do we get $20 oil?
So API says more inventory was added, but the DOE says there was an inventory draw. Who do we believe?
Do we also believe the stories of millions of barrel being shipped all over the place to make it look like inventories are being drawn down.
Like always reality is far different form what is reported. Anything related to .gov is 99.9% lies. The .1% truth is there so they can say there is truth in what they say.
API is notoriously wrong. The interesting point is that even with rising production, inventories continue to fall. Impoprts were 7.4mmbbl/day and my opinion is that as long as they are under 7.2mmbbl/day, inventories will fall. I am actually surprised to see such a large draw with imports at 7.4mmbbl/day. I think most of what is going on today is dollar longs trying to protect their opposite pair trade by shorting more gold and oil. Cushing fell by 1mmbbl last week, is that a lie? Moving oil around costs money, if you believe that is happening in order to manipulate theinventory data you are believing nonsense. I thought Cushing was supposed to be full long ago according to the pundits that get to write articles here.
Another record bu 2/10ths of a percent that is not an actual number but trumped up bi EIA? LOL joke bias here is unreal.....
Yes, Tyler, let's see well data from the Bakken, Eagle Ford, and Permian instead of EIA's guess.
you all need to check on the strategic reserve ... they have quietly been adding to it for weeks, but its tough to find any current statistics on it ....
Nope, easy to find facts and nothing has been added or subtracted this year. Last year they dumped 5mmbbl on the market to start the ball rolling downhill.
http://energy.gov/fe/services/petroleum-reserves/strategic-petroleum-res...