- EIA inventories report to be published at 1430 GMT
- Tuesday's API print showed a near 1-million barrel build in stocks
- Market still feeling the effects of last week's surprise gasoline build
- WTI support at $48.80/b key to keeping door locked on $45.80/b move
Crude oil's latest 8% selloff was accelerated by a surprisingly bearish US inventory report last Wednesday. One week later and the 'Weekly Petroleum Status Report' from the EIA is once again the sole focus in the market. The weekly industry report from the American Petroleum Institute, released one day in advance of the official EIA report, once again cast some doubts on the outcome.
The API last night reported that US crude oil stocks rose by 897,000 barrels last week while gasoline jumped by 4.45 million barrels to the highest since January 20. A Bloomberg survey ahead of today's official EIA report has pinned expectations on a 1.75 million decline in crude oil stocks together with a small 500,000 barrel increase in gasoline.
WTI crude oil is holding above key support at $48.80/b ahead of the report. Failure to hold could see the market targeting $45.80/b. A move back above $50/b is likely to confirm our overall view that the market remains rangebound for now.
The latest surveys carried out by Bloomberg shows the previous two results together with the price reaction following last week's bearish report (see below). The estimate on the weekly change in production slowed to 17,000 b/d last compared with an average increase of 30,000 b/d since last October....MOREFront (June) futures $49.15 down 41 cents.