Crude oil futures
December WTI (West Texas Intermediate) crude oil (USO) (SCO) (USL) futures contracts rose 0.55% to $54.68 per barrel in electronic exchange at 2:15 AM EST on November 1, 2017. WTI oil futures are at the highest level since July 2015. The prices (DBO) (UCO) rose due to the massive fall in US crude oil inventories reported by the API (American Petroleum Institute) the previous day. US crude oil inventories have fallen by 35.1 MMbbls (million barrels) since the beginning of 2017, according to the API.
The December 2017 E-Mini S&P 500 (SPY) futures contracts rose 0.2% to 2,578 in electronic exchange during the same period on November 1, 2017.
API’s gasoline and distillate inventories
On October 31, 2017, the API published its crude oil inventory report. It estimates that US gasoline and distillate inventories fell by 7.6 MMbbls and 3.1 MMbbls on October 20–27, 2017.
The market expected US gasoline and distillate inventories to fall by 1.50 MMbbls and 2.12 MMbbls during the same period.
A massive fall in gasoline and distillate inventories is bullish for gasoline (UGA), diesel, and crude oil (UWT) (DWT) prices. US crude oil prices are at a 27-month high. Higher oil prices benefit oil producers (XOP) (IEO) like Denbury Resources (DNR), Noble Energy (NBL), Anadarko Petroleum (APC), and Cobalt International Energy (CIE).
EIA’s US crude oil inventories
The EIA (U.S. Energy Information Administration) will release its crude oil inventory report at 10:30 AM EST on November 1, 2017. If the EIA reports a massive fall in US crude oil, gasoline, and distillate inventories, it could benefit oil (OIL) (DTO) prices.
In the next part, we’ll discuss how gasoline demand impacts crude oil prices.