WTI Drops After 3rd Weekly Build In Gasoline Inventories

Tyler Durden's picture

Amid Libya headlines and contract rollover, WTI prices were wild heading into the inventory data tonight. Following two weeks of surprising builds in Gasoline inventories, API reports a surprise 3rd weekly build in gasoline inventories, and crude drawing only modestly (in line with expectations). The initial reaction was a kneejerk lower, breaking down the day's wedge.

 

API

  • Crude -3.595mm (-3.5mm exp)
  • Cushing -462k (+300k exp)
  • Gasoline +1.402mm (-1mm exp)
  • Distillates +2.048mm

Last week confirmed the concerns about building gasoline (even though crude saw a draw) and API shows a 3rd week of builds (and crude's draw was just in line) and Distillates also saw the biggest build since July

Price action was chaotic today heading into the API data and immediately kneejerked lower (breaking down from the wedge)...

“If we are going to get into a new era of instability with Libyan oil production, if it becomes a wild card again, that’s definitely supportive for prices,” Phil Flynn, senior market analyst at Price Futures Group, told Bloomberg, adding, with reference to today's price action, there’s “a little bit of expiration madness. There’s a lot of positioning before the September expiration."

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Five Star's picture

There were no production cuts. OPEC cuts were more than 100% offset by rising US production 

 

http://thesoundingline.com/combined-us-opec-oil-production-pace-set-new-...

ThirdWorldNut's picture

Everyday that WTI is around 50 or less is a tax on Saudis for spreading militant islam through the world.

HillaryOdor's picture

Look at that chart.  Looks like someone tried to force it through the resistance line at the last minute to get the horde to jump back in and the market said "nuh uh."

LawsofPhysics's picture

"market"...

LMFAO!!!!

How much of that GDP is nothing but useless fucking paper-pushing? Nigga please.

zebra77a's picture

There be smoke - there be fire.

UAE ordered 2 million barrels of Condensate FROM NEW YORK. No explaination other than a trade sanction with Qatar.. But why not order it from Saudi Arabia next door than have to ship it back half way around the world? Saudi Arabia reports in Nov 2016 at their current rate they will go bankrupt.

We just need an announcement from Gartmen to short Oil, and we *KNOW* this is going to $150 / barrel asap.

Something is going on...

oak's picture

"ADNOC earlier bought Khuff condensate from Saudi Arabia to replace Qatari supplies, the trade sources said, but the production volume of this oil is small and it is usually consumed locally"

https://af.reuters.com/article/commoditiesNews/idAFL3N1KH2CJ

DWD-MOVIE's picture

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Oracle of Kypseli's picture

TBTB want to ship out of WTI to show lower levels which is a metric for paper oil trading.

 

 

 

Horse Pizzle's picture

Thirty million fat Saudis sit in the nest with their mouths open waiting for a worm.  They don't work, they breed. The Saudi budget deficit is $6 billion/year but they have $500 billion in the bank.

The Cooler King's picture

Me? I'm puttin out the fire with gasoline

Mon T's picture

The Shep Wave is calling this. They need to update crude charts mo often.

jmack's picture

That wedge was a beautiful thing

 

LawsofPhysics's picture

"price stability"...

LMFAO!!!

LawsofPhysics's picture

Again, talking about "prices" in the absence of a mechanism for true price discovery is a fool's errand.

"Full Faith and Credit"

GooseShtepping Moron's picture

"A surprising build in gasoline inventories" is a euphemism for demand destruction due to a stagnant global economy. It's not as if oil refineries were going hell bent for leather and suddenly said "Oops! Looks like we made too much gasoline!"

adr's picture

When oil is $47 and gasoline is priced like it's $100, you're going to get the demand destruction of $100 oil. 

Not that hard to figure out. 

Diesel is $2.18 at my local station but 87 is $2.64. That's fucking retarded. 

Juggernaut x2's picture

We went front $2.07 to $2.55 in about an hour yesterday morning

dunce's picture

Our oil companies are doing alright, OPEC is facing slow death of their single source economies.

Sapere aude's picture

Five Star. You should get out more and research.

The U.S. production 'surge' is complete and utter rubbish.

Its not just me writing that, its physics supporting it.

Look at the rigs, the number of wells on the shale, then look at the legacy rates....that makes it impossible that U.S. production is rising, hence the imports are.

Why is it that U.S. citizens are prepared to believe most anything they are told without researching it, and then look back at history to see what previous fake news they were given.

Now let us just look at one of yesterday's comments:

"A couple of notable things have occurred in the past month or so. Pioneer Natural Resources, a top Permian producer, raised concerns when it told investors that its Permian shale wells were coming up with a higher natural gas-to-oil ratio than expected, a potentially worrying sign. The company also reported that it had trouble with some of its wells, forcing it to delay some completions."

Sapere aude's picture

Dunce. Are you joking!

 

Our oil companies are not doing alright. NOT ONE shows a profit on shale. ANy that are making profit are doing so from ME oil or oil outside of the US. Shale is causing them to selll assets, cut dividends, cut jobs, and push hundreds of companies into bankrupty.

 

16/5/17 Oil Patch Transportation, Inc. $2,432,801
17/5/17 Gulfmark Offshore, Inc. $560,197,094
17/5/17 Tidewater Inc. $2,340,910,000
19/5/17 Archer Limited $601,750,000
1/6/17 Halker Consulting LLC $3,639,829
2/6/17 Rooster Energy LLC $51,872,931
8/6/17 Deep Operating LLC $1,454,853
13/6/17 Duron Systems Inc. $5,880,785
13/6/17 Petroleum Speciality Rental, LLC $1,695,318
14/6/17 CGC Holdings (US) LLC $3,445,118,255
18/6/17 Quality Oil Tools LLC $10,891,219
21/6/17 Omega Alpha Resources LLC $167,945
28/6/17 KMK Oil & Gas, inc $10,325
29/6/17 King's Peak Energy, LLC $23,455,992
7/7/17 Waller Marine, Inc. $2,887,997
14/17/17 Pellerin Energy Rentals, LLC $118,091
17/7/17 Double Eagle Energy Services LLC $1,185,392
17/7/17 West Texas Bulldog Oilfield Services LLC $5,500,085
20/7/17 Prospector Offshore Drilling S.A.R.L. $166,051,933

Sapere aude's picture

zebra77...perhaps you should research whether in fact they did import the condensate in the first place? Of course it came from Saudi, but attributed to US just to massage U.S. oil figures. Even drawing down from the SPR has helped massage U.S. oil figures, hence the need for some to mention sell off of SPR oil just to bring it back to the levels its actually at, rather than explain a black hole of crude in storage.