Baku, August 25,AZERTAC
The latest Energy Information Administration (EIA) crude inventories data recorded a build of 2.5mn barrels in the latest week compared with an expected draw of close to 0.5mn barrels and following a draw of 2.5mn last week, according to Economic Calendar. The data will tend to undermine sentiment with inventories high in historic terms, although markets will be wary of very choppy trading conditions and a possible snapback in prices.
There was a build in Cushing stocks of 0.38mn barrels, which was higher than expected.
Gasoline inventories were unchanged on the week, while distillates stocks rose by 0.1mn barrels. Both gasoline and distillate inventories remain well above historical averages for this time of year, but the data was less impressive than the API estimate of a substantial gasoline draw.
US crude production declined over the week to 8.548mn bpd from 8.597mn previously following the significant increase seen last week, which will tend to lessen immediate concerns surrounding excess supply with production down from 9.340mn bpd last year.
The latest American Petroleum Institute (API) inventories data recorded an unexpected and substantial crude inventory build of 4.5mn barrels in the latest week compared with expectations of a small draw.
Although the damage to oil prices was cushioned to some extent by a decline in gasoline and distillate stockpiles, prices still retreated towards the $47.50 area following the data.
There was a slightly stronger dollar tone, especially against the Euro, in European trading, which put some downward pressure on crude prices. WTI dipped to just above the $47.00 level at the US open before a move higher into the data.
WTI dipped sharply lower after the data with September prices at $47.00 from $47.55 ahead of the release with a subsequent test of support below this level.