The market anticipates that crude oil inventories at Cushing rose from October 6 to 13. Cushing inventories rose for the ninth time in the last ten weeks. High Cushing inventories could have a negative impact on crude oil (DBO)(UCO)(USL) prices.
EIA’s Cushing inventories
Cushing inventories had risen by 1,322,000 barrels or 2.1% to 63.7 MMbbls (million barrels) between September 29 and October 9. Inventories rose for the seventh consecutive week. Cushing inventories had risen by 2,450,000 barrels or 4% from the same period in 2016.
EIA’s US crude oil inventories
Nationwide crude oil inventories fell by 2.7 MMbbls (million barrels) to 462.2 MMbbls between September 29 and October 6. Similarly, US inventories were down 11.8 MMbbls or 2.5% year-over-year. Nationwide crude oil inventories are 21% above their five-year average for the week ending October 6.
Impact of US and Cushing inventories
Cushing inventories are at their highest level since May 26. They’ve risen by 7.4 MMbbls or 13% in the last ten weeks. High nationwide and Cushing inventories could pressure crude oil (USO)(DWT) prices. Volatility in oil prices impacts oil exploration and production companies (XLE)(VDE) like Denbury Resources and Goodrich Petroleum.
Next, we’ll cover how the US crude oil rig count impacts oil prices.