WTI Plunges To $44 Handle After Inventory & Demand Disappointment

After tumbling last night following API's surprise builds, WTI/RBOB levitated on a weak dollar into the DOE print but initialy kneejerked lower on the data which showed a smaller than expected crude draw and confirmed another significant gasoline build. After a small drop last week, crude production rose once again to cycle highs.

API

  • Crude +2.75mm (-2.45mm exp)
  • Cushing -833k
  • Gasoline +1.794mm (-1.15mm exp)
  • Distillates -1.451mm

DOE

  • Crude -1.66mm (-2.45mm exp)
  • Cushing -1.156mm (-1.4mm exp)
  • Gasoline +2.096mm (-1.15mm exp)
  • Distillates +328k (+550k exp)

Last night's surprise build in crude was not confirmed (but the DOE data showed a smaller than expected draw). Cushing stockpiles fall to the lowest level of the year, dropping more than a million barrels for a second week. The total is now 62.2 million barrels, plenty of room in the tanks there. However, Gasoline inventories rose once again...

 

After a modest drop in production in the Lower 48 last week, US crude production rose once again this week to its cycle highs...

 

As Bloomberg's Laura Blewitt notes, Gasoline demand dropped for the second week in a row after hitting a record-high 9.822 million barrels a day, according to the one-week preliminary data. With another build in stockpiles reported, gasoline futures are down to the lowest levels since November.

 

WTI/RBOB prices rallied into the print this morning on the back of a dramatically weaker dollar but once the data printed, selling began...

 

WTI just hit a $44 handle - the lowest since early May...

Comments

TroyAndAbed Wed, 06/14/2017 - 10:54 Permalink

Too many stakeholders that want higher prices, and the shale guys won't be able to survive at $45 WTI despite the talk track that they can break even at that price. These prices can't last. I'm getting long.

gregga777 Wed, 06/14/2017 - 11:26 Permalink

Well, 102 MILLION unemployed working age Americans don't:

  • buy much gasoline or diesel fuel;
  • buy much at the local mall or department store;
  • buy much at their local restaurants;
  • have a big fat paycheck to finance their consumption;
  • care for either the Demo-Marxist or Repussican Party political parasites;

And the 43 MILLION Americans dependent on USDA SNAP EBT cards can only buy food and drink items with their generous benefits.  So, they aren't buying a lot of fuel or consumer goods down at the local mall. But, never fear the Goldman Sachs Feral Reserve System and the US Bureau of LYING Statistics says that the unemployment rate is "only" 4.3%.  

shortonoil Wed, 06/14/2017 - 11:39 Permalink

"B.b..but muh peak oil..."

This has absolutely nothing to do will PO; which is an over simplified explanation of an extraction curve. It is the direct result of the depletion taking place in the petroleum production system, and it will continue until that system stops.

http://www.thehillsgroup.org/

sinbad2 Wed, 06/14/2017 - 20:05 Permalink

Too much oil, too little consumption.If the biggest oil producer was taken out(USA), the global oil price and the global economy would recover.