Oil prices held on to gains overnight after a surprisingly large crude draw reported by API (though crude is down about 18% from its late April highs as the trade war between the U.S. and China, the world’s biggest economies, weighs on demand.).
“The drawdown will certainly help support sentiment,” said Daniel Hynes, a senior commodity strategist at Australia & New Zealand Banking Group Ltd. in Sydney.
“But the market is definitely taking the glass-half-empty type approach to data.”
Crude -3.454mm (-1.8mm exp)
Cushing -2.803mm - biggest draw since Feb 2018
Crude -2.73mm (-1.8mm exp)
After two weeks of unexpected builds, crude inventories drew down more than expected last week (though less than API reported) but Gasoline and Distillates stocks rose more than expected...
Despite the ongoing collapse in the oil rig count, US crude production remains near record highs...
WTI tested above $57 ahead of this morning's inventory data but slid lower after the DOE data printed below API's and gasoline and distillates builds offset the crude draw's bulishness...
“It’s a tight market right now,” said Bjarne Schieldrop, the Oslo-based chief commodities analyst at SEB AB. “But the assumption is that the future will be very bleak and bearish.”