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Will Crude Oil Inventories Pressure Oil Futures?

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API’s crude oil inventories 

On August 1, 2017, the API (American Petroleum Institute) released its weekly crude oil and gasoline report. It reported that US crude oil inventories rose 1.8 MMbbls (million barrels) between July 21 and July 28, 2017.

A Bloomberg survey estimated that inventories would fall 3.1 MMbbls during the same period. A surprise rise in US crude oil inventories pressured US crude oil (USO) (UCO) prices in post-settlement trade on August 1, 2017. Lower crude oil prices have a negative impact on oil producers like Contango Oil & Gas (MCF), ConocoPhillips (COP), Apache (APA), Stone Energy (SGY), and W&T Offshore (WTI).

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API’s Cushing crude oil inventories

The API added that Cushing crude oil inventories rose 2.6 MMbbls (million barrels) from July 21 to July 28, 2017. A Bloomberg survey estimated that Cushing inventories would fall 700,000 barrels during the same period. Cushing is the largest crude oil storage hub in the US.

API’s gasoline and distillate inventories

The API reported that US gasoline inventories fell 4.9 MMbbls between July 21 and July 28, 2017. A Bloomberg survey estimated that US gasoline inventories would fall one MMbbls during this period.

The API estimates that US distillate inventories fell 1.2 MMbbls between July 21 and July 28, 2017. A Bloomberg survey estimated that distillate inventories fell 0.9 MMbbls during the same period.

EIA’s crude oil inventories  

The EIA (U.S. Energy Information Administration) will release its Weekly Petroleum Status Report on August 2, 2017, at 10:30 AM EST.

A surprise rise in US crude oil inventories could pressure crude oil prices. However, US crude oil inventories are expected to fall due to the fall in imports from Saudi Arabia. Moves in crude oil prices affect oil producers like Stone Energy (SGY) and W&T Offshore (WTI).

In the next article, we’ll analyze how US gasoline demand impacts crude oil prices.

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