WTI Crude has ramped into this morning's DOE data back to the scene of the crime from last night's API ugly data dump. With API reporting a build that doubled expectations, DOE reports a 3.6mm build but worse still yet another major (4.6mm barrel) build in gasoline stocks for the largest 3-week build in history. Crude initially tumbled but the algos took over and ramped to yesterday's highs...running stops (but how long will that last?)
- *CRUDE OIL INVENTORIES ROSE 3.98 MLN BARRELS, EIA SAYS
- *GASOLINE INVENTORIES ROSE 4.56 MLN BARRELS, EIA SAYS
The data breaks down as follows...
- Crude +2.2m estimate (BBG users est 3.75mm) vs +4.6m API
- Cushing crude +400k estimate vs +63k API
- Gasoline +1.9m estimate vs +4.7m API
- Distillates +800k estimate vs +1.5m API
As the following chart shows, Gasoline and Crude saw major builds and Cushing the 12th weekly build in a row...
And as inventories surge, Proroduction rises for the 6th week in a row....
And Demand collapses...
The reaction in crude is clear - after the algos ramped to run stos at the API ledge from last night... but the algos then took over again and ramped us...Don't hold your breath!
And credit risk signals today's bounce is overdone...
So to sum up, demand is plunging, supply is surging, inventories are rising at a record pace and credit is collapsing... so oil rallied!?