uploads///Crude oil inventory June

Will the API and EIA Stockpile Reports Mirror Each Other?

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Jun. 25 2015, Updated 1:06 p.m. ET

EIA inventory report 

Yesterday, the API (American Petroleum Institute) reported that the crude oil stockpile fell by 3.2 MMbbls (million barrels) for the week ending June 19, 2015. For the week ending June 12, crude oil stocks fell by 2.9 MMbbls, according to API estimates. The API report is a precursor to Wednesday’s inventory report from the EIA (U.S. Energy Information Administration).

The EIA published that US oil stocks fell by 2.7 MMbbls to 467.9 MMbbls for the week ending June 12, 2015. Wall Street Journal and Platts surveys show that the US stockpile could fall by 2.3 MMbbls for the week ending June 19, 2015. The consensus of the falling inventories will continue to support crude oil prices.

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Like crude oil, gasoline stocks are also expected to fall by 0.304 MMbbls for the week ending June 19, 2015—compared to the rise of 0.460 MMbbls for the week ending June 12, 2015. In contrast, distillates stocks are expected to rise by 0.993 MMbbls for the week ending June 19, 2015—compared to the rise of 0.114 MMbbls for the week ending June 12, 2015.

The inventories at Cushing, Oklahoma, are also expected to fall by 2 MMbbls for the week ending June 19, 2015—according to the market consensus. Last week , the inventories at Cushing rose by 113,000 bpd (barrels per day). Cushing is the delivery point for NYMEX-traded crude oil futures contracts. The fall in inventories might be due to the rising refinery demand. The falling stockpile will continue to support crude oil prices.

Upstream companies like Kosmos Energy (KOS), Newfield Exploration (NFX), and Chevron (CVX) benefit from rising crude oil prices. They account for 4.91% of the Energy Select Sector SPDR ETF (XLE). These stocks have a crude oil production mix that’s more than 53% of their total production. Volatility in the crude oil market also impacts energy ETFs like XLE and the SPDR S&P Oil & Gas Exploration & Production ETF (XOP).

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