Crude oil is weaker in the early hours
After rising more than 5% on November 15, crude oil prices are weaker in the early hours on November 16. At 5:40 AM EST on November 16, the West Texas Intermediate crude oil futures contract for December delivery was trading at $45.37 per barrel—a fall of ~0.96%. The Brent crude futures contract for January 2017 delivery fell ~0.83% to $46.78 per barrel.
API reported a build in crude oil inventories
On November 15, the API (American Petroleum Institute) reported that crude oil inventories rose by 3.65 MMbbls (million barrels) in the week ending on November 11. The market expected a build in inventories by 1.48 MMbbls. The higher-than-expected build in the inventory levels reported by the API weighed on crude oil prices in the early morning hours on November 16. Today, the market is looking forward to weekly crude oil inventory data by the U.S. Energy Information Administration.
Renewed expectations of an output cut improved the sentiment
The renewed optimism about an output cut announced by OPEC in its Algeria meeting improved the market sentiment. It made the prices rise on November 15. Read Crude Oil Rose on November 15 amid OPEC’s Supply Cut Hopes to learn how OPEC’s supply cut hopes pushed crude oil prices higher. Crude oil didn’t carry the same momentum into the early morning hours on November 16 due to profit-booking and the API’s bearish weekly crude inventory report.
On November 15, major crude oil producers Carrizo Oil & Gas (CRZO), Canadian Natural Resources (CNQ), Total SA (TOT), and British Petroleum (BP) rose 3.5%, 3.1%, 2.8%, and 1.9%, respectively. The SPDR S&P Oil & Gas Exploration and Production ETF (XOP) and the PowerShares DB Oil ETF (DBO) rose 4.1% and 4.6%.