Wednesday, February 7, 2018

Oil: "WTI/RBOB Sink After US Oil Production Hits Record High, Surpassing Saudis"

Quite amazing.
From ZeroHedge:
WTI/RBOB held on to gains after last night's surprise crude draw from API, but quickly tumbled after DOE reported a 1.9mm crude build (2nd week in a row) and significant gasoline and distillate builds. However, US crude production's massive spike to 10.25m b/d was the big headline.

API
  • Crude -1.05mm (+3.15mm exp)
  • Cushing -633k
  • Gasoline -227k
  • Distillates +4.552m
DOE
  • Crude +1.895mm (+3.15mm exp)
  • Cushing -711k (-263k exp)
  • Gasoline +3.414mm (+500k exp)
  • Distillates +3.926mm (-1.25mm exp)
Last week's surprise (huge) crude build from DOE was dismissed by API overnight but DOE ruined that party and showed the second weekly crude build in a row. Gasoline and Distillates stocks resumed their rise.
As Bloomberg's David Marino notes, Total U.S. inventories grew the most since early September. It's actually even a bigger deal than the headline number suggests: if not for a 6.4 million draw from propane/propylene and "other" oils, we'd be looking at a 10 million barrel build.
But all eyes were once again on US crude production as it smashed above 10m b/d.
As Bloomberg's Julian Lee notes, that huge jump in crude production is not the result of a sudden burst of drilling. More likely it is the correction we expected after the earlier release of monthly data for November that showed production was already above 10 million barrels a day three months ago....
...MORE

Recently on the blog:
Feb. 1
"U.S. monthly crude oil production exceeds 10 million barrels per day, highest since 1970"
Jan. 22
BP: Peak Oil (Demand)