Crude Tumbles After Big Crude, Distillates Build

Having extended yesterday's losses on the back of API's unexpectedly large distillates inventory build, DOE data confirmed an even bigger crude inventory build (+2.276mm vs ~1.3mm build exp.), which contrary to seasonal patterns was the second build in a row, and 5 builds in the past 6 weeks. Gasoline drew down less than API reported and Distillates built considerably more than expected (+1.5mm vs +275k exp). While production slipped lower by 0.7%, crude prices tumbled on the inventory news, back down to $45.50.

API

  • Crude +942k (+1.5mm exp)
  • Cushing -620k
  • Gasoline -1.6mm (-1.25mm exp)
  • Distillates +3mm (+275k exp)

DOE

  • Crude +2.276mm (+1.3mm exp)
  • Cushing -1.039mm
  • Gasoline -691k (-1.25mm exp)
  • Distillates +1.496mm (+275k exp)

The crude breakdown by region:

  • PADD1 20.259mbbl +0.143
  • PADD2 151.032mbbl -1.403
  • PADD3 275.55mbbl +2.911
  • PADD4 26.974mbbl +0.243
  • PADD5 52.055mbbl +0.381

And gasoline:

  • PADD1 67.178mbbl -1.936
  • PADD2 49.859mbbl +1.497
  • PADD3 78.513mbbl +0.555
  • PADD4 6.578mbbl -0.395
  • PADD5 29.876mbbl -0.411

Also notably, on a seasonal basis, Gulf Coast and East Coast crude stocks just hit reacord levels.

Chart, the second weekly build in crude and a big build in distillates looks as follows:

Also of note, the weekly crude oil imports rose to the highest since September 2012, adding to the glut.

Looking at gasoline data, we find that gasoline stocks are now +17.8 million bbl (+8.3%) above 2015 level and +24 million bbl (+11.6%) above 10-yr median

 

The accelerated shift of gasoline from the East Coast appears to be working, as a result of the abovementioned 1.9mbbl drop from PADD1:

 

Finally, looking at overall US production, after a big surge in production two weeks ago, it has now been largely erased following the last 2 weeks declines:

 

And having tested down to a $45 handle, crude inched above $46 ahead of the print then plunged...

 

Charts: Bloomberg