The API (American Petroleum Institute) released its weekly inventory report on November 15, 2016. It reported that US gasoline inventories fell by 155,000 barrels from November 4–11, 2016. In contrast, US distillate inventories rose by 3 MMbbls (million barrels) during the same period.
Market surveys estimated that US gasoline inventories would fall by 0.4 MMbbls from November 4–11, 2016. Surveys also estimated that US distillate inventories would fall by 1.7 MMbbls during the same period.
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On November 16, 2016, the EIA (U.S. Energy Information Administration) will release its crude oil inventory report for the week ending November 11, 2016.
The EIA reported that US gasoline inventories fell by 2.8 MMbbls to 221 MMbbls between October 28 and November 4, 2016. US distillate inventories fell by 1.9 MMbbls to 148.6 MMbbls during the same period. However, US gasoline and distillate inventories were above their five-year upper range.
A larger-than-expected fall in distillate and gasoline inventories could support gasoline and crude oil prices. However, a rise in inventories could pressure gasoline and crude oil prices.
The ups and downs in crude oil prices could impact oil and gas producers’ earnings such as Bonanza Creek Energy (BCEI), SM Energy (SM), ExxonMobil (XOM), Continental Resources (CLR), and Denbury Resources (DNR).
Uncertainty in crude oil (USO) (RYE)(DTO) (BNO) prices could also impact ETFs and ETNs such as the ProShares UltraShort Bloomberg Crude Oil ETF (SCO), the SPDR S&P Oil & Gas Exploration & Production ETF (XOP), the VelocityShares 3x Long Crude Oil ETN (UWTI), the Direxion Daily Energy Bear 3x ETF (ERY), the Vanguard Energy ETF (VDE), the SPDR S&P Oil & Gas Equipment & Services ETF (XES), the PowerShares DWA Energy Momentum ETF (PXI), and the United States 12 Month Oil ETF (USL).
In the next parts of this series, we’ll discuss how the monthly US crude oil production impacted the crude oil market.