Following last week’s biggest crude build since 2016, API reports another large crude draw (seemingly confirming refinery run rates remain high), but WTI/RBOB prices slipped lower on an unexpectedly large build in Gasoline (and Distillates).
Genscape reported a 750k draw at Cushing last week…
Crude -4.62mm (-3.25 exp) -0 9th weekly build in a row
Cushing -1.56mm (-593k exp) – biggest draw since Oct ’16
Gasoline +4.08mm (-50k exp) – biggest build since Jan ’17
Following last week’s biggest build since 2016, API reported a 9th weekly draw in Crude but Gasoline saw its biggest build since Jan 2017, very much against the recent trend…
Libya production updates and weak economic data weighed on crude ahead of the API print tonight but as the data hit showing a bigger than expected crude draw (8th week in a row), both WTI and RBOB jumped higher. This was the biggest crude draw since Sept 2016.
Crude -8.67mm (-3mm exp)
Gasoline -1.726mm (-1.5mm exp)
If this holds for tomorrow’s DOE data, this is the 8th weekly crude draw in a row (and this week’s 8.67mm draw is the largest since Sept 2016)
Russian deputy finance minister Kolychev is on the wires with some less-than-enthusiastic talk about oil. He said prices are likely to stay in the $40-$50 range for 5-7 years. In addition, he said risks are that prices could fall below $40 and that it’s hard to say if the OPEC deal will help the market rebalance.
The market is certainly voting for the downside today. Brent is down $1.95 to $49.89.