Following last week's 2nd build in a row (and 5th of last 6), API reports crude inventories collapse over 12 million barrels - the most since Jan 1999 (against expectations of a 905k barrel build). Crude had rallied on the day early hovering aroung $45.50 for a few hours before the data hit, but spiked above$46 after the print.
- Crude -12.08mm (exp +905k)
- Cushing -0.7mm (exp -900k)
- Gasoline -2.388mm (exp -750k)
- Distillates +944k
The biggest crude inventory draw since Jan 1999... We presume this massive drop is some reflection of the shut-ins from the Gulf thanks to the storms. NOTE - in 2013, there was a 10mm-plus barrel draw during a heavy storm season in The Gulf and also in 2009 during a heavy storm season.
Now all eyes will be on tomorrow's DOE data - better not disappoint after this.
After treading water for the last 5 hours - very oddly - crude's reaction to the API data was expectedly a knee-jerk higher towards the Saudi-Russia statement failure highs...
“We’ll need to see a significant shock to the market to break out of this range over the next several weeks” leading up to OPEC talks later this month, Michael Tran, a commodities strategist at RBC Capital Markets in New York, says by phone, and we may have just got it.