As evidenced by the price action in both the WTI and Brent crude oil benchmarks, volatility shows no signs of lessening following last Friday’s OPEC decision as oversupply fears and inventory constraints are once again at the forefront of investor sentiment. The drawdown according to the American Petroleum Institute numbered at 1.900 million barrels, beating expectations of a 1.200 million barrel drop in inventories. However, today’s official number from the US Department of Energy could contrast with the drawdown with forecasts anticipating a gain of approximately 250,000 which stands at odds with the API numbers. More importantly, the Cushing inventory facility continues to fill as evidenced by another 614,000 barrels added to storage. After touching multi-year lows before the announcement, crude oil prices surged by nearly 5.00% within two hours before retracing part of the move and retreating modestly.
API Reports a Drawdown
Daily Analysis - 09/12/2015