WTI Turns Green After API Reports Across-The-Board Inventory Draws
Oil prices slipped lower today after uglier than expected inflation sent yields higher (whipsawed wider markets) and perhaps more notably, OPEC said its latest supply cuts had stalled as Iraq and Libya producing more than their quota.
Slightly higher-than-expected CPI numbers are not likely to “rock the boat,” said Ole Hansen, a commodity strategist at Saxo Bank A/S, “overall a report that is unlikely to impact the thinking.”
Analysts expected a seventh straight weekly build in crude stocks...
API
Crude -5.52mm (+400k exp)
Cushing -998k
Gasoline -3.75mm
Distillates -1.16mm
After 6 straight weeks of builds, API surprised by reporting a large crude draw last week. In fact, stockpiles drew-down across the whole complex...
Source: Bloomberg
WTI was trading around $77.75 ahead of the print and rallied after...
And while crude prices declined, wholesale gasoline prices are soaring... and so are pump prices...
Source: Bloomberg
There’s a risk that premium gasoline prices could reach a multi-year high this year, said Mukesh Sahdev, head of oil trading and downstream research at Rystad Energy AS.
“There’s not a lot President Biden can do in time for the election, if this happens” he said.
“Strategic petroleum reserves are low, and there are few levers for the US government to pull to lower gasoline prices.”
Of course, we are sure Biden will blame gas stations if prices go up.
