API crude oil inventory data
The API (American Petroleum Institute) released its weekly commercial crude oil inventory report yesterday. The report showed that the crude oil inventory rose by 11.4 MMbbls (million barrels) for the week ending January 22, 2016. This was the highest crude oil inventory build since 1996. The crude oil inventory had risen by 4.6 MMbbls for the week ending January 15, 2016. The API report added that the crude oil inventory at Cushing, Oklahoma, also rose by 0.66 MMbbls for the week ending January 22.
EIA crude oil inventory report
The API crude oil inventory report is followed by the EIA’s (U.S. Energy Information Administration) weekly oil inventory report, which is scheduled for release today. Last week’s report showed that the US commercial crude oil inventory rose by 4 MMbbls to 486.5 MMbbls for the week ending January 15.
Market surveys estimate that the crude oil inventory may have risen by 3.2 MMbbls and that the gasoline inventory may have risen by 1.5 MMbbls for the week ending January 22, 2016. In contrast, the distillate inventory may have fallen by 1.9 MMbbls for the same period. The crude oil inventory may have risen due to the rise in imports or the fall in refinery demand as a result of seasonal maintenance.
The current US crude oil inventory is 22% more than the level in 2014. It’s also at an 80-year high for this time of year. The rising crude oil and gasoline inventories will continue to put pressure on crude oil prices in the short term. The contango market and rising global inventory benefit oil tankers like Nordic American Tankers (NAT) and DHT Holdings (DHT). Likewise, crude oil prices have risen by 18% from 13-year lows in the last five trading sessions. Higher oil prices benefit oil producers like Chevron (CVX), Hess (HES), Pioneer Natural Resources (PXD), and Noble Energy (NBL). Read the next part of this series to learn how oil prices are influenced by OPEC’s production.
ETFs and ETNs like the United States Oil Fund (USO), the VelocityShares 3x Long Crude Oil ETN (UWTI), and the ProShares UltraShort Bloomberg Crude Oil ETF (SCO) are influenced by the roller-coaster ride in oil prices.