Following API's big builds in Crude, Cushing, and Distillates, DOE reported notable inventory builds across the entire energy complex with a bigger than expected crude build sparking initial selling pressure in WTI. Every segment was 'worse' than expected (from a price perspective) but the machines have decided it is time to panic buy after another spurious OPEC headline.
API
- Crude +3.65mm (+1mm exp)
- Cushing +1.13mm (+150k) – biggest since August
- Gasoline -155k (-1.1mm exp)
- Distillates +2.98mm – first build in 8 weeks
DOE
- Crude +5.274mm (+1mm exp)
- Cushing +691k (+150k) – biggest since August
- Gasoline +746k (-1.1mm exp) – first build in 4 weeks
- Distillates +310k- first build in 8 weeks
The EIA adds that East Coast imports rose to the highest in 4 years: average weekly crude imports increased 122% to 1.38m b/d, highest since September 2012. Imports by country:
- Canada imports 3243k vs 3206k
- Saudi Arabia imports 1047k vs 1295k
- Venezuela imports 932k vs 533k, highest since March
- Mexico imports 683k vs 515k
- Colombia imports 414k vs 33k
- Ecuador imports 245k vs 278k
- Nigeria imports 303k vs 113k
- Kuwait imports 151k vs 97k
- Iraq imports 638k vs 427k
- Angola imports 307k vs 64k, highest since July
Crude build bigger than expected but builds across the entire complex for the first time since August
The last 3 weeks of builds have erased the drawdowns of the summer…
Putting the rebound in context:
Regional Breakdown:
- PADD1 17.282mb -0.843
- PADD2 141.012mb +1.054
- PADD3 255.407mb +4.939
- PADD4 24.353mb -0.137
- PADD5 52.229mb +0.261
Bloomberg's Gurpal Dosanjh note that the East Coast continues to be a dumping ground for crude and refined products. The gasoline build was driven by an increase in imports, but the numbers don't look good for U.S. refiners as we head into winter.
Bear in mind, as Bloomberg's Vince Piazza notes, bloated stockpiles are still over 33% above their five-year norms and seasonally, Gasoline is due to start building soon…
Last week saw the biggest surge in US production since May 2015 and this week's small drop still leaves production at 5-month highs
And, just as we predicted minutes after the surprising build in inventory…
More OPEC headlines stat
— zerohedge (@zerohedge) November 16, 2016
… the jawboning began, and sent oil surging:
- RUSSIA’S NOVAK SAYS MAY MEET SAUDI ARABIA’S FALIH IN DOHA
- RUSSIA ENERGY MINISTER SAYS SEES BIG CHANCES FOR OPEC TO AGREE
- RUSSIA ENERGY MINISTER SAYS EVERYTHING WILL DEPEND ON OPECS DECISION, RUSSIA WILL SUPPORT OPEC DECISION
- RUSSIA ENERGY MINISTER SAYS THERE IS NOT YET DECISION WHICH DATE TO TAKE FOR OIL FREEZE, NOVEMBER OR JAN 1
Even though:
- RUSSIA ENERGY MINISTER SAYS FORMAT FOR NOV 30 MEETING NOT YET DECIDED
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