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WTI Slides After Crude Inventories Drawdown Less Than Hoped

Summary:
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 ...

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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.”

API

  • Crude -3.454mm (-1.8mm exp)

  • Cushing -2.803mm - biggest draw since Feb 2018

  • Gasoline -403k

  • Distillates +1.806mm

DOE

  • Crude -2.73mm (-1.8mm exp)

  • Cushing -2.485mm

  • Gasoline +312k

  • Distillates +2.61mm

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...

WTI Slides After Crude Inventories Drawdown Less Than Hoped

Source: Bloomberg

Despite the ongoing collapse in the oil rig count, US crude production remains near record highs...

WTI Slides After Crude Inventories Drawdown Less Than Hoped

Source: Bloomberg

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...

WTI Slides After Crude Inventories Drawdown Less Than Hoped

“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.”

Tyler Durden
Tyler Durden (a pseudonym) represents the idea that a return to truly efficient markets is a possibility and a necessity. After having experienced the inner workings of capitalism at various asset managers and advisors, Tyler believes that the current model is flawed and a deleveraging at every level of modern society is needed to reinspire the fundamental entrepreneurial spirit. Visit his blog: ZeroHedge (http://www.zerohedge.com/)

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