API crude oil inventory
The API (American Petroleum Institute) is scheduled to release its weekly crude oil, gasoline, and distillate inventory report today. The US industry group reported that crude oil inventory fell by 1.9 MMbbls (million barrels) for the week ending December 4. In contrast, the US crude oil inventory rose by 1.6 MMbbls for the week ending November 27. Genscape reports that crude oil inventory at Cushing, Oklahoma, is at record levels. Cushing, Oklahoma, is the largest storage hub in the United States.
API and EIA crude oil inventory data
The API crude oil inventory is a precursor to the EIA’s (U.S. Energy Information Administration) weekly petroleum status report, which is scheduled for release tomorrow. The EIA reported that crude oil inventory fell by 3.6 MMbbls to 485.9 MMbbls for the week ending December 4, 2015.
Market surveys from Bloomberg suggested that US crude oil inventory would fall by 0.5 MMbbls for the week ending December 11, 2015. The consensus of falling crude oil inventory could benefit crude oil prices. The record low short positions could be covered due to the fall in crude oil inventory. The US crude oil inventory might have fallen due to the rise in inventory demand or the fall in US crude oil imports.
The consensus of falling crude oil inventory could benefit crude oil prices, and the record-low short positions could be covered due to the fall in crude oil inventory. US crude oil inventory might have fallen due to the rise in inventory demand or the fall in US crude oil imports.
Refined products inventory
The EIA added that US gasoline inventory rose by 0.8 MMbbls for the week ending December 4, 2015. Likewise, distillate fuel inventory rose by 5 MMbbls for the same period. Crude oil inventory is at an 80-year high for this time of year and is 28% higher than the crude oil inventory of 380 MMbbls in 2014. Record refined products inventory and crude oil inventory should continue to put pressure on crude oil prices.
Record-low crude oil prices will likely impact US upstream players like Murphy Oil Corporation (MUR), Whiting Petroleum Corporation (WLL), Continental Resources (CLR), and EOG Resources (EOG). ETFs like the Vanguard Energy ETF (VDE), the iShares US Oil Equipment & Services ETF (IEZ), and the First Trust Energy AlphaDEX Fund (FXN) are also affected by the uncertainty in the crude oil market.
Read the next part of this series to find out what could drive crude oil prices higher.