WTI Spikes After Iraq Headlines, Unexpected Crude Inventory Draw
A crude draw and bigger than expected gasoline build overnight from API did nothing for oil prices as OPEC headlines dominate trading and DOE data confirmed API with a modest crude draw and bigger than expected Gasoline build. Oil prices are rising on Iraq headlines even as crude production rose very modestly.
- Crude -1.28mm (+1mm exp)
- Cushing -140k (-100k exp)
- Gasoline +2.68mm (+900k exp)
- Distillates -350k
- Crude -1.255mm (+1mm exp)
- Cushing -97k (+300k exp)
- Gasoline +2.317mm (+900k exp)
- Distillates +327k (-1mm exp)
Confirming API data, DOE reports a bigger than expected Gasoline build and modest crude draw (as crude imports dropped 845k last week). Notably Distillates are still building at a time when seasonal norms should see a draw.
As Bloomberg reports, the draw was concentrated in PADD 3, the Gulf Coast and PADD 5, the West Coast. Excluding PADD 5 which is geographically isolated, crude builds slightly.
US Crude Production rose very modestly on the week
Oil prices were spiking into the DOE print as OPEC headlines hit – IRAQ WILL “SHOULDER RESPONSIBILITY” FOR SOME OF OPEC’S PLANNED PRODUCTION CUTS – PM ABADI – and extended as the crude draw helped the machines…
Notably, Macquarie sees about a $20-a-barrel difference between having an OPEC deal and not having one.