Afternoon Market Overview

The API started the weekly inventory report cycle with a larger than expected build in crude oil stocks offset a bit by larger than expected draws in both gasoline and distillate fuel inventories. Total combined inventories of crude oil and products were modestly lower on the week.

Overall the market added to its intraday losses for crude oil while erasing some of the refined product losses after the report was issued.

The API reported US crude oil stocks increased by 5.3 million barrels on the week. Cushing crude oil stocks increased by 1.7 million barrels. They also reported a 2.2 million bbl draw in distillate fuel inventories and a 5.8 million bbl draw in gasoline stocks. Total combined inventories of crude oil and refined products were modestly lower for the week and outside the range of market expectations. Crude oil stocks likely increased as refiner demand for crude oil decreased while refined product inventories are projected to be lower in this week’s report.

Canadian imports into the US for the week ending Mar 16 increased by 325,000 bpd to 3.423mn bpd and are now 212,000 bpd below the previous all-time record- high reached early in 2017, per the U.S. Energy Information Agency.

We are maintaining our overall oil view and short-term bias at cautiously bullish. The current fundamentals are still supportive, and the externals are mostly supportive. The next few fundamental snapshots will provide further directional guidance.