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WTI/RBOB Extend Losses After Smaller Crude Draw; Production Plunged
01-10-2018, 11:55 AM,
#1
WTI/RBOB Extend Losses After Smaller Crude Draw; Production Plunged
WTI/RBOB Extend Losses After Smaller Crude Draw; Production Plunged

<p>Both WTI/RBOB are fading into this morning's data after API's massive crude draw print. <strong>DOE disappointed with a mere 4.95mm draw</strong> (vs 11.2mm draw from API) as <strong>gasoline inventories built for the 9th week in a row</strong>. However, <strong>production plunged almost 3%.</strong></p>

<p>Bloomberg Intelligence Senior Energy Analyst Vince Piazza noted that <strong>U.S. oil inventories typically build this time of year,</strong> but refineries are chugging away and focusing on West Texas intermediate instead of higher-priced Brent. The North Sea grade's price remains elevated, reflecting tensions in the Middle East.</p>

<p><u><strong>API</strong></u></p>

<ul><li><strong>Crude 11.19mm (-421k exp) - biggest draw since Sept 2016</strong></li>
<li>Cushing -2.156mm (-1.5mm exp)</li>
<li>Gasoline +4.685mm (+3.25mm exp)</li>
<li>Distillates +4.635mm (+2.25mm exp)</li>
</ul><p> </p>

<p><u><strong>DOE</strong></u></p>

<ul><li><strong>Crude -4.95mm</strong> (-3.75 exp)</li>
<li>Cushing -2.4mm (-1.5mm exp)</li>
<li>Gasoline +4.13mm (+3.25mm exp)</li>
<li>Distillates +4.25mm (+2.25mm exp)</li>
</ul><p>8th week in a row of crude draws and gasoline builds, but <strong>the crude draw was considerably lower than API predicted...</strong></p>

<p> </p>

<p><a data-responsive-image-style="inline_images" href="https://www.zerohedge.com/sites/default/files/inline-images/20180110_DOE2.png"><img data-entity-type="file" data-entity-uuid="0a4a3d09-d5fa-4661-8000-ffa55e095c91" data-responsive-image-style="inline_images" srcset="https://www.zerohedge.com/sites/default/files/styles/inline_image_desktop/public/inline-images/20180110_DOE2.png?itok=8Bw_mcLL 1x" src="https://www.zerohedge.com/sites/default/files/inline-images/20180110_DOE2.png" alt="https://www.zerohedge.com/sites/default/files/inline-images/20180110_DOE2.png" typeof="foaf:Image" /></a></p>

<p>Notably <strong>Cushing stockpiles are below their 5year average</strong> for the first time since Jan 2015...</p>

<p><a data-responsive-image-style="inline_images" href="https://www.zerohedge.com/sites/default/files/inline-images/20180110_DOE1.png"><img data-entity-type="file" data-entity-uuid="e1903634-854c-47a8-aa60-e833b173f6a2" data-responsive-image-style="inline_images" srcset="https://www.zerohedge.com/sites/default/files/styles/inline_image_desktop/public/inline-images/20180110_DOE1.png?itok=ud-xY56Y 1x" src="https://www.zerohedge.com/sites/default/files/inline-images/20180110_DOE1.png" alt="https://www.zerohedge.com/sites/default/files/inline-images/20180110_DOE1.png" typeof="foaf:Image" /></a></p>

<p> </p>

<p>Overall, <strong>US crude stockpiles are nearing the five-year average after three years above that level</strong>...</p>

<p><a data-responsive-image-style="" href="https://www.zerohedge.com/sites/default/files/inline-images/20180109_API1.png"><img alt="https://www.zerohedge.com/sites/default/files/inline-images/20180109_API1.png" data-entity-type="file" data-entity-uuid="92f30650-c4eb-4d67-a73b-0d74f02afb2f" data-responsive-image-style="" height="258" src="https://www.zerohedge.com/sites/default/files/inline-images/20180109_API1.png" width="488" /></a></p>

<p>The last time oil inventories in the world’s biggest economy touched these levels was September 2015.</p>

<p> </p>

<p>Production rebounded in the previous week but The EIA <strong>revised down its baseline for U.S. oil production significantly, pegging last week output at 9.492m b/d (down 290,000 b/d from the previous week) - a 2.97% plunge</strong>... (presumably weather-related)</p>

<p><a data-responsive-image-style="inline_images" href="https://www.zerohedge.com/sites/default/files/inline-images/20180110_DOE3.png"><img data-entity-type="file" data-entity-uuid="d48e5758-1015-4289-8536-cbd29e9b208b" data-responsive-image-style="inline_images" srcset="https://www.zerohedge.com/sites/default/files/styles/inline_image_desktop/public/inline-images/20180110_DOE3.png?itok=ralog4Cy 1x" src="https://www.zerohedge.com/sites/default/files/inline-images/20180110_DOE3.png" alt="https://www.zerohedge.com/sites/default/files/inline-images/20180110_DOE3.png" typeof="foaf:Image" /></a></p>

<p>Further on the IEA weekly estimate, Bloomberg suggests that <strong>perhaps the agency is taking into account closures related to the freezing weather of the last few days, which have been reported even in Texas</strong> (and, more widespread, in North Dakota).</p>

<p>Although much of the news flow centered on its impact on the east coast,<strong> the temperature map below shows a much wider impact that may well have hit production in places like the Bakken.</strong></p>

<p> </p>

<p><a href="https://www.zerohedge.com/sites/default/files/inline-images/20180110_DOE5.png"><img data-entity-type="file" data-entity-uuid="fafbde4e-1df8-4a91-805f-ac3a4e7ade55" data-responsive-image-style="inline_images" srcset="https://www.zerohedge.com/sites/default/files/styles/inline_image_desktop/public/inline-images/20180110_DOE5.png?itok=OwytL9AD 1x" src="https://www.zerohedge.com/sites/default/files/inline-images/20180110_DOE5.png" alt="https://www.zerohedge.com/sites/default/files/inline-images/20180110_DOE5.png" typeof="foaf:Image" /></a></p>

<p>The initial reaction was to extend losses from before the print and erased API gains...</p>

<p><a data-responsive-image-style="inline_images" href="https://www.zerohedge.com/sites/default/files/inline-images/20180110_DOE4.png"><img data-entity-type="file" data-entity-uuid="1d100b92-a10e-42e3-a76c-354c9e4f2330" data-responsive-image-style="inline_images" srcset="https://www.zerohedge.com/sites/default/files/styles/inline_image_desktop/public/inline-images/20180110_DOE4.png?itok=U9MrM5bp 1x" src="https://www.zerohedge.com/sites/default/files/inline-images/20180110_DOE4.png" alt="https://www.zerohedge.com/sites/default/files/inline-images/20180110_DOE4.png" typeof="foaf:Image" /></a></p>

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