WTI/RBOB bounced today in anticipation of a reversal of the last two week's builds in crude inventories, and bulls were not disappointed by the API print. Jan '18 WTI pushed above $57 and RBOB rose after a big crude draw (though gasoline build).
“It looks like we are going to get a draw in crude oil inventories. That’s somewhat supportive,” John Kilduff, a partner at Again Capital LLC, a New York-based hedge fund, said by phone.
WTI/RBOB prices tumbled today on demand outlook cuts (and late comments from Brazil and Russia with regard OPEC cuts) ahead of tonight's API report which is expected to show crude and gasoline draws. However, WTI/RBOB prices extended their losses as Crude (biggest in 9 months) and Gasoline saw significant builds.
API
WTI/RBOB held on to gains overnight following major draws reported by API and more OPEC jawboning (this time from UAE), but the DOE data disappointed compared to API's huge draws with Crude and Gasoline drawing down but considerably less than API reported (and Distillates barely drawing down at all).
Bloomberg Intelligence energy analyst Fernando Valle:
Strong demand continues to spur inventory drains. Crude-oil stocks remain elevated, but refined-product inventories are looking increasingly tight.
WTI advanced to the highest level since April today amid OPEC considering an extension of output caps, and extended gains after API data despite a surprise build in crude. RBOB gained on a much bigger than expected gasoline draw (-5.7mm vs +1.7mm exp).
API
Following API's huge 7.1mm barrel crude draw overnight, WTI prices are slightly higher (driven more by OPEC jawboning) as last week's API errors are still on traders' minds, but DOE confirmed a big crude draw but notable builds in gasoline and distillates surprised. However, the biggest headline is likely the 11%-plus collapse in US crude production...
API