API crude oil inventories
On September 7, 2016, the API (American Petroleum Institute) will release its weekly crude oil inventory report. A Reuters survey showed that US crude oil inventories fell by 100,000 barrels between August 26 and September 2, 2016. The decrease in crude oil inventories will benefit US crude oil prices. High crude oil prices positively impact the earnings of oil and gas producers such as Synergy Resources (SYRG), Comstock Resources (CRK), and Sanchez Energy (SN). For more on prices, read part one of this series.
On August 30, 2016, API reported that US crude oil inventories rose by 942,000 barrels from the week ending August 26, 2016.
EIA’s crude oil inventories
Tuesday’s API report will be followed by the EIA’s (U.S. Energy Information Administration) weekly crude oil inventory report for the week ending September 2, 2016, on September 8, 2016, at 10:30 AM EST.
For the week ending August 26, 2016, the EIA reported that US crude oil inventories had risen by 2.3 MMbbls (million barrels) to 525.9 MMbbls between August 19 and August 26, 2016. For a regional breakdown of crude oil inventories, read US Crude Oil Inventories Pressured Crude Oil Prices.
Impact of US crude oil inventories
US crude oil inventories hit an all-time high of 543.6 MMbbls in the week ending April 29, 2016. Near-record global and US crude oil inventories could pressure crude oil prices. Lower crude oil prices impact the earnings of oil and gas producers like Synergy Resources (SYRG), Comstock Resources (CRK), and Sanchez Energy (SN).
The roller coaster ride in oil prices also impacts ETFs and ETNs such as the Guggenheim S&P 500 Equal Weight Energy ETF (RYE), the ProShares Ultra Oil & Gas (DIG), the ProShares UltraShort Bloomberg Crude Oil ETF (SCO), the iShares U.S. Energy ETF (IYE), and the United States Brent Oil ETF (BNO).
In the next two parts of this series, we’ll look at some key bearish drivers for crude oil prices.