API crude oil inventory
The API (American Petroleum Institute) is expected to release its weekly crude oil inventory report on April 5, 2016. The API estimated that the US crude oil inventory rose by 2.6 MMbbls (million barrels) for the week ending March 25, 2016—compared to the previous week. It also estimated that Cushing crude oil stocks fell by 0.32 MMbbls for the same period. To learn more about Cushing crude oil stocks, read How Cushing Inventories Could Affect Crude Oil Prices.
EIA crude oil inventories
Tuesday’s API crude oil inventory data are followed by Wednesday’s EIA (U.S. Energy Information Administration) inventory data. The EIA is expected to release its weekly crude inventory on April 6, 2016. It reported that the US crude oil inventory rose by 2.3 MMbbls to 534.8 MMbbls between March 18, 2016, and March 25, 2016. This is the US crude oil inventory’s highest level.
The ups and downs in crude oil inventories impact storage costs. For more on this, read Crude Oil Storage Costs Rose 9 Times, US Crude Tests New Limits and Record US Crude Oil Inventory Led to a New Storage Space.
Impact of record nationwide crude oil inventories
Crude oil inventories are 14% more than the same period in 2015. Market surveys by Reuters suggest that US crude oil stocks rose by 3.3 MMbbls for the week ending March 25. The expectation of rising and record US crude oil inventories could pressure crude oil prices. Low crude oil prices impact oil producers like Bonanza Creek Energy (BCEI), Cobalt International Energy (CIE), and Halcon Resources (HK).
The contango market and record US crude oil inventories benefit crude oil tanker companies like Frontline (FRO), Teekay Tankers (TNK), and DHT Holdings (DHT). For more information on US energy companies’ financial woes, read US Oil and Gas Companies’ Debt Exceeds $200 Billion and Crude Oil’s Total Cost of Production Impacts Major Oil Producers.
The ups and downs in crude oil prices impact ETFs like the United States Oil Fund (USO), the United States 12 Month Oil (USL), the ProShares UltraShort Bloomberg Crude Oil ETF (SCO), and the Fidelity MSCI Energy (FENY).
Read the next part of the series to learn more about gasoline and distillate inventories.