WTI Pops After Huge Crude Inventory Drawdown

WTI prices have roller-coastered (generally lower) since last week's inventory(lower)/production(higher) data back to unchanged but as API printed a massive 8.133mm crude drawdown (vs 2.45mm exp), the biggest since Sept 2016 if DOE confirms, WTI prices quickly jumped higher. Gasoline also saw a bigger than expected draw while Distillates built.

 

API:

  • Crude -8.133mm (-2.45mm exp) - biggest draw since Sept 2016
  • Cushing -2.028mm - biggest draw since Feb 2014
  • Gasoline -801k (-534k exp)
  • Distillates+2.079mm

Big drawdowns across the board last week from API and DOE added to in crude and gasoline this week...

 

A lot of hope today as EIA cut its 2018 crude production forecast (modestly) - “This pull-back in production is kind of wake-up call to people who thought that shale was going to be viable no matter what OPEC did,” Phil Flynn, senior market analyst at Price Futures Group in Chicago, says by phone, adding "If output doesn’t rise as much as previously anticipated, “then it’s time for the bears to start questioning their religion again."

Notice that WTI was trading at the same level as it was when last week's API data hit before the print...once the data hit, WTI was bid above $45.50...Deja vu all over again

However, what Flynn and the algos probably missed was EIA's cut on demand expectations and price outlooks.

Comments

Tugg McFancy Jul 11, 2017 6:52 PM Permalink

It was reported 6-8 weeks ago OPEC would be diverting shipments away from the US to get some movement in US stocks.It would be first noticed in July. If true and it's happening there no point being a bear for a while (no matter where they hide it) because no one ever pays attention to anything but US inventory. 

adr Jul 11, 2017 5:47 PM Permalink

So the algos bought oil back to the point it was last week. Oil is down $10 from the level that gave us $2.45 gas, but gas has only fallen $.10.Of course $40 oil should be $1.45 gas, but don't let logic and historical prices get in the way of manic manipulation. 

jmack Jul 11, 2017 4:55 PM Permalink

Gartman, calling the ebbs and flows of the market, like only he can.   If tomorrow's report gets this thing to close above 47, I am going to laugh my ass off.

Yen Cross Jul 11, 2017 4:55 PM Permalink

 Glad I covered yesterday.  When Ole Yeller is bloviating, I stay flat, and square up my trades.  I'll bet Gartman has cozied up to a nice toilet bowl full of pruno, and a pipe/bong full of ragweed right about now.

Arnold Arnold Jul 11, 2017 5:07 PM Permalink

Big Johnson: [flying in the chopper to the roof] Just like fuckin' Saigon, hey, Slick?

Little Johnson: [smiling] I was in junior high, dickhead.
.

Dwayne T. Robinson: We're gonna need some more FBI guys, I guess.
.

Holly Gennero McClane: After all your posturing, all your little speeches, you're nothing but a common thief.

Hans Gruber: I am an exceptional thief, Mrs. McClane. And since I'm moving up to kidnapping, you should be more polite.

In reply to by Arnold

Arnold Arnold Jul 11, 2017 5:21 PM Permalink

Dwayne T. Robinson: We don't know shit, Powell. If there's hostages, how come nobody's come to us with ransom demands, huh? If there's terrorists in there, where's their list of demands? All we know is that somebody shot your car up. It's probably the same silly son of a bitch you've been talking to on that radio.

Sergeant Al Powell: Excuse me, sir! But what about the body that fell out the window?

Dwayne T. Robinson: Well, who knows? Probably some stockbroker, got depressed.

In reply to by Arnold

peopledontwanttruth Juggernaut x2 Jul 11, 2017 4:59 PM Permalink

Jugger and Rainman I'm not sure of the date but it could be either of the ones you picked but it's all manipulated. Don't know all the reasons but just taking a wild guess thinking it's got to be either derivatives or balancing spreadsheets behind the scenes as they're trying to patch a sinking ship with duct tape. The last several months to years this subject on ZH is mind numbing on up, then down, no up then up some more by a few hours later another unexpected draw/build. Nothing as far as the world's biggest commodity moves that much that they couldn't see coming.

SNIFF

Something smells like sh&t

In reply to by Juggernaut x2