Afternoon Market Overview

The API started the weekly inventory report cycle with a mixed inventory snapshot. Crude oil showed a surprise build in inventory after nine weeks in a row of drawdowns. Gasoline stocks built more than expected and distillate fuel inventories declined within the range of expectations.

The total combined inventories of crude oil and products were modestly higher on the week. Overall the market gave back some of its intraday gains for RBOB and crude oil but added to the gains in ULSD after the report was issued. The API reported US crude oil stocks increased by 4.8 million barrels on the week on a 1 million bpd increase in crude oil imports. Cushing crude oil stocks decreased by 3.6 million barrels. They also reported a 1.3 million bbl draw in distillate fuel inventories and a 4.1 million bbl build in gasoline stocks.

Total combined inventories of crude oil and refined products were modestly higher for the week and outside the range of market expectations also shown in the table above. Crude oil stocks likely decreased even as refiner demand for crude oil decreased while refined product inventories are projected to be mixed in this week’s report.

Canadian imports into the US for the week ending Jan 12 decreased by 248,000 bpd to 3.625mn bpd and are now just 10,000 bpd below the previous all-time record-high reached early in 2017, per the U.S. Energy Information Agency.