The market continued to drop yesterday; WTI closed down $1.13/bbl to $43.65, HO closed down $0.0221/gal to $1.3334, and RBOB finished down $0.0528/gal to $1.51. After the close, the market started to recover in response to the API statistics released at 4:30 p.m. ET. The API’s showed a build in crude inventories of 1.3 million barrels, with a build of 380,000 barrels in Cushing, OK. The stats for refined products were bullish; a draw of 2.6 million barrels in distillates and a draw of 1.2 million barrels in gasoline.
The DOE statistics released today at 10:30 a.m. ET were not as bullish as the APIs and the market reacted accordingly. The DOE’s showed a build of 2.8 million barrels in crude with a 243,000 barrel build in Cushing triggering the highest level reached on record in the East Coast and Midwest since at least 1990. Distillates had a draw of 1.3 million barrels, while gasoline had a small build of 536,000 barrels.
Typically, with that size build in crude, we would see crude prices fall more dramatically, however, wildfires in the heart of Canada’s main oil-producing region is propping them up. The wildfires have caused the evacuation of 80,000 people in the area as well as multiple oil sands facilities, such as Shell and Suncor, to reduce crude production or fully shut down. Thankfully, no injuries or deaths have been reported. This event will have long term effects on inventory levels here in the states in the upcoming weeks/months.