Crude Oil Storage Report - October 26

[dan_s]

CRUDE OIL INVENTORY'000 bbls (Week Ended 10/21/16)

Current: 468,158
Actual Build/(Withdrawal): (553)
Economist Average Estimate: 1,169
Previous: 468,711

Gasoline stocks fell by 1.956 mn barrels after a gain of 2.469 mn barrels the previous week.
Gasoline inventories were forecast to fall by 963,000 barrels.

[bearcatbob]

Is this number not simply a matter of how many tankers were unloaded in a given week? To me it is meaningless.

[setliff]

its maintenance season for the refiners--they have been only 85% of capacity---what happens when they ramp up for winter?

numbers were very bullish, imo.

[dan_s]

bearcatbob: Yes, IMO the weekly EIA storage report for crude oil is just a single data point which speculators over-react to. As I have pointed out in several of my podcasts, it is impacted the most by the timing of imports and is not a good indicator of increasing or decreasing production. The U.S. imports over 70 million barrels of crude oil and other hydrocarbon based liquids each week. It does not come in steadily, especially during hurricane season. See: http://www.eia.gov/dnav/pet/pet_sum_sndw_dcus_nus_w.htm

However, the longer term trend is very bullish. Dave Purcell at TPH, Credit Suisse and Raymond James have all forecast a steady decline in OECD inventories. They all believe that over time this will push crude oil prices higher.

If you have not watched the Dave Purcell video, do it right now. It is less than 10 minutes long. Here is the link: https://vimeo.com/187401085/833dc64725