Cushing Inventories Fell 20% from the Peak


Aug. 7 2017, Updated 12:35 p.m. ET

Cushing inventories 

A preliminary market survey estimates that Cushing inventories fell on July 28–August 4, 2017. Inventories fell for the 11th consecutive week. They are also at a 21-month low. A fall in Cushing inventories is bullish for crude oil (RYE) (USO) (UCO) prices.

Higher crude oil (PXI) (USL) prices have a positive impact on oil and gas producers such as ExxonMobil (XOM), Apache (APA), PDC Energy (PDCE), and Cobalt International Energy (CIE).

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EIA’s report  

On August 2, 2017, the EIA (U.S. Energy Information Administration) released its weekly petroleum status report. It reported that Cushing crude oil inventories fell by 0.39 MMbbls (million barrels) to 55.8 MMbbls on July 21–28, 2017. Inventories have fallen 0.1% week-over-week and 12.9% year-over-year.

The EIA will release its weekly petroleum status report on August 9, 2017, at 10:30 AM EST.

US crude oil inventories 

US crude oil inventories fell by 1.5 MMbbls (million barrels) or 0.3% to 481.8 MMbbls on July 21–July 28, 2017. Inventories are below the five-year range. For more on US crude oil inventories, read US Crude Oil Inventories Fell 10% from Their Peak.

Impact of falling Cushing inventories 

Cushing is the largest crude oil storage hub in the US. Cushing crude oil inventories have fallen ~20% from the peak hit in April 2017. Inventories have fallen for the 16th time in the last 20 weeks. The expectation of a fall in US and Cushing crude oil inventories would support US crude oil (RYE) (VDE) prices. Higher crude oil prices benefit oil producers such as PDC Energy (PDCE) and Cobalt International Energy (CIE).

Next, we’ll analyze the US crude oil rig count and its impact on oil prices.


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