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Is Oil On Its Way To $80?

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Oil Prices Rise After API Reports Major Crude Draw

Crude oil pipeline

As oil prices continues to fall, the American Petroleum Institute (API) reported a major draw of 9.228 million barrels of United States crude oil inventories for the week ending June 22 compared to analyst expectations that this week would see a much smaller draw in crude oil inventories of 2.572 million barrels.

Last week, the American Petroleum Institute (API) reported a draw of 3.016 million barrels of crude oil.

The API reported another buildup in gasoline inventories for week ending June 22, this week in the amount of 1.152 million barrels. This was close to analyst expectations of a build of 1.313 million barrels.

Crude oil prices spiked today on the back of anticipated oil export disruptions in Libya after the Libyan National Army said it had passed control of the country’s oil ports to a non-officially recognized National Oil Corporation affiliated with the eastern government of the country based in Benghazi. Further support to oil prices come as the United States continues to pressure countries to cease buying oil from Iran.

By 3:40pm EDT, WTI was trading at $70.43, up $2.35 (+3.45%). Brent crude was trading at $76.15, up $1.60 (+2.15%).

Related: WTI-Brent Spread Narrows On Canada Oil Crisis

US crude oil production stagnated for the first week in many months, reaching 10.9 million bpd in the week ending June 08, holding fast for the week ending June 15, according to the EIA.

Distillate inventories saw a build this week of 1.785 million barrels, compared to an expected build of 774,000 barrels, while inventories at the Cushing, Oklahoma, site fell again this week, by 1.741 million barrels.

The U.S. Energy Information Administration report on crude oil inventories is due to be released on Wednesday at 10:30am EDT.

By 4:36pm EST, oil prices held steady, with the WTI benchmark trading up 3.61% on the day to $70.54 and Brent trading up 2.31% at $76.27.

By Julianne Geiger for Oilprice.com

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  • Mamdouh G Salameh on June 27 2018 said:
    Between them, the API and the EIA perform “a good boy bad boy act” when it comes to movements in the US crude and product inventories.

    Yesterday the API reported a draw of 9.228 million barrels of US crude oil inventories for the week ending June 22, 2018 and a build-up of 1.152 million barrels in gasoline inventories.

    Therefore, it would be a safe bet to expect the EIA to announce a huge build-up in its crude and gasoline inventories when it releases its report today.

    The EIA has been for ages using reported increases in its crude and gasoline inventories to manipulate oil prices. However, the global oil market has got wiser to such ploys.

    Dr Mamdouh G Salameh
    International Oil Economist
    Visiting Professor of Energy Economics at ESCP Europe Business School, London
  • Frank on June 26 2018 said:
    It's late June and commercial stockpiles are still far higher than at any point in history prior to 2015. Apparently no one is interested in the fundamentals of a dying industry. This market is rigged.

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