Wednesday, June 29, 2016

"Oil Jumps Above $49 As Crude Production Tumbles, Inventories Drop"

WTI $49.13 up $1.28 and my first thought is "That's all you've got?"
From the intro to a June 3 post:

Chartology: Oil Prices Seeming Tired
July futures $49.05 off 12 cents.
Some folks we talk to are looking for a repeat of last year's July downturn which started in the middle of the U.S. peak driving season but this year may be later, something we haven't clearly identified-probably financialization of some sort-has been levitating prices in the face of more-than-adequate-supply....
To quote an insurance guy from Omaha:

"Now I'm known as a long-term investor and a patient guy, but that is not my idea of a big move."
-Warren Buffett

Today's headline story from ZeroHedge:
Following last night's across the board inventrory drawdown from API, DOE data was more mixed with a surpsingly large build in gasoline stocks but bigger than expected Distillates and total crude inventory drawdowns. Production tumbled 0.63% MoM, the biggest drop in 2 months and back to Sept 2014 lows. Crude prices spiked above $49 for the firest time since Brexit.
  • Crude -3.86mm (-2.5mm exp)
  • Cushing -1.207mm (-900k exp)
  • Gasoline -416k
  • Distillates -832k
  • Crude -4.05mm (-2.5mm exp)
  • Cushing -951k (-900k exp)
  • Gasoline +1.367mm
  • Distillates -1.801mm
6th week of crude inventory draws, Distillates back into drawdown as Gasoline built....MORE