On the eve of the biggest OPEC decision in recent history, the American Petroleum Institute (API) has released crude inventory data showing the biggest build in Cushing since March 2015, along with a small overall draw in U.S. crude oil inventories.
The API has reported a draw in crude U.S. crude oil inventories of 717,000 barrels, while expectations were that we would see an increase of 577,000 barrels.
However, no one expected such a big build in Cushing, which API says was up 2.3 million barrels, making it the biggest build the second quarter of last year. Analysts were expecting a build of only 26,000 barrels.
While overall crude inventories saw a drawdown, gasoline stocks saw their biggest build since January, up 3.36 million barrels, against expectations of a build half that size.
Distillates were also up, according to the API, which reported a 2.24 million build, against expectations of a 1.45 million build. This is also distillates' biggest build in over two months.
The market is not reacting with any drama to the API inventory report, which usually creates some volatility and a great deal of speculation, but the pending OPEC decision is overshadowing inventory fundamentals. Even tomorrow's official data from the Energy Information Administration (EIA) is not expected to elicit a major market response.
Last week, official EIA data reported a 1.3-million barrel draw in crude oil stockpiles, along with a 2.3-million barrel build in gasoline inventories. Last week API data estimated a build of 2.68 million barrels in gasoline inventories.
By Julianne Geiger for Oilprice.com
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Julianne Geiger is a veteran editor, writer and researcher for Oilprice.com, and a member of the Creative Professionals Networking Group. More