WTI/RBOB Jump After Biggest Crude Inventory Draw Since 2016

Tyler Durden's picture

WTI and RBOB have rallied since last night's surprisingly large Crude draw (and gasoline build) reported by API, and DOE ata confirmed with inventory draws across the entire complex (including gasoline). WTIO and RBOB prices popped as Crude inventories dropped most since 2016 despite crude production rising above 9.3mm - highest since Aug 2015.

API

  • Crude -5.789mm (-2mm exp) - biggest since 2016
  • Cushing -133k (+60k exp)
  • Gasoline +3.169mm (+350k exp)
  • Distillates -1.174mm (-800k exp)

DOE

  • Crude -5.247mm (-2mm exp)
  • Cushing -438k (+60k exp)
  • Gasoline -150k (+350k exp)
  • Distillates -1.587mm (-800k exp)

Draws across the board with Crude inventories down most since Dec 2016

 

Gasoline demand is going against the seasonal norm... declining in the last few weeks when it should be surging iont summer driving season

 

 

U.S. crude production continued its steady rise, up 21,000 barrels a day to 9.314 million. That's 12 consecutive increases, 13 in 14 weeks, and 14 in 16 weeks. Production now at the largest since August 2015.

As a reminder, Bloomberg notes that EIA bumped up its estimates and forecasts for U.S. crude production yet again in yesterday's STEO report. It increased its April estimate by 20,000 b/d and May by 40,000 b/d compared with the previous month's forecast. For Lower 48 onshore output, the increase was even bigger -- 50,000 b/d for April and 60,000 b/d for May. It now sees output exceeding the April 2015 peak of 9.63 million barrels a day by November, a month earlier than before.

 

WTI and RBOB both rallied overnight (as the dollar sank) following the big API-reported crude draw, and extended their gaisn after DOE confirmed the draw...

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mily's picture

It's time to pass the "Ramp Stawks" baton from JPY to OIL, both API and DOE record draw...coincidence

Nothing's picture

Neither production nor inventory matter very much.  If the US $ drops, oil will rise accordingly ....

Seasmoke's picture

These every other day contradictory gas headlines are Hilarious.

Lastline's picture

Bullshieeeeeeet

Juggernaut x2's picture

ahhhh- so this is why every station in town raised the price of gas by 40 cents a gallon last night at 6PM.

directaction's picture

The 13-year-long world oil production plateau has stopped undulating and started declining.

Now is when the excitement and fun really begins. 

spastic_colon's picture

slightly OT - the machines are in overdrive; PCLN, AAPL, YELP, FB, GOOG, AMZN etc all down and the NDQ barely bugding with VIX and VXO all being managed.

Captain Sensible's picture

Looks like the Pierre Andurand( shit the bed ) bottom is in for now  LOL 

venturen's picture

any mention of record exports an dropping imports?

LawsofPhysics's picture

Are you saying we are no longer a net importer?

Oh yeah, show me that data.

CNONC's picture

I don't see that he implied that we have become a net exporter, but he is absolutely correct that imports are down from peak of around 14mm bbd in 2006 to about 10mm now.  Exports are way up, from around 1mm in 2006 to around 6mm today.  That is a pretty big cumulative change.

https://www.eia.gov/dnav/pet/PET_MOVE_WKLY_DC_NUS-Z00_MBBLPD_W.htm

LawsofPhysics's picture

Technical analysis in the Fed's casino.

Is what it is.

shizzledizzle's picture

Yea, memorial day is just around the corner... Better get those gas prices up before America sets out on vacation.

Snaffew's picture

they must be putting the oil back into the ground to get the prices up.  Otherwise, there is no reason for such a massive drawdown.  memorial day weekend won't account for any impact of significance.

CNONC's picture

I suspect the flooding in the central part of the US is part of the reason. The set up in the Missouri and Mississippi basins looks alot like 1993. I think the local tank farms are stocking up on supplies in case pipelines get flooded and have to shut down like in 93.

Snaffew's picture

so...buy the drip?

adr's picture

Do will still have more inventory that when oil was $26? Yep.

Are gasoline stockpiles greater than when gas was heading close to $1? Yep.

 

The Saudi production "cut" jawbone was one of the most successful scams of all time. It doubled the price of oil yet kept production near record highs. Oil stockpiles never fell below January 2016 but gasoline prices doubled along with oil. Instead of paying $1.50 with $50 oil most Americans are paying $2.35+ making the margins on selling refined product higher than ever.

Zepper's picture

You sir are a scholar. 

 

To add insult to injury on the 25th the SCAM will continue. 

 

Oil hit its bottom at 26 and should have declined from there given the massive volumes of oil going into reserves, massive volumes of capped wells ready to go, and declining world demand from previous estimates.