Sign up today for an exclusive discount along with our 30-day GUARANTEE — Love us or leave, with your money back! Click here to become a part of our growing community and learn how to stop gambling with your investments. We will teach you to BE THE HOUSE — Not the Gambler!

Click here to see some testimonials from our members!

WTI Holds Near 6-Month Highs Amid Gulf Shut-Ins, Inventory Draws

Courtesy of ZeroHedge View original post here.

Oil prices were higher today, driven in large part by significant shut-ins across the Gulf of Mexico. WTI traded back above $43.

As Bloomberg's Kriti Gupta details, the Gulf of Mexico is responsible for 17% of U.S. offshore oil production, 82% of which has been shut in preparation for the storm (up from 58% yesterday). So the simple explanation for rising crude is less production means less supply and higher prices.

It gets even thornier when you consider that 45% of total U.S. petroleum refining capacity also is located along the Gulf Coast.

This is unlikely to be reflected in any inventory/production data released this week.

API

  • Crude -4.524mm (-4.3mm exp)

  • Cushing -646k

  • Gasoline -6.392mm (-2.7mm exp) – biggest draw since April 2019

  • Distillates +2.259mm (-700k exp)

Analysts expected a fifth weekly crude draw in a row and a continuing trend of draws in Gasoline stocks also… API reported bigger than expected draws for Crude and Gasoline (with the latter's biggest drop in stocks since April 2019)…

Source: Bloomberg

WTI closed at its highest for the front-month contract since early March…

Source: Bloomberg

Oil was trading around $43.35 ahead of the print, and was little changed after the data.

"Markets know that the hurricane shut-ins are usually transient, and it's a bit too early to know whether the current ones will have a prolonged bearish effect on prices or not," said Bjornar Tonhaugen, head of oil markets at Rystad Energy, in a daily note. "Refineries might need to shut-in more runs due to flooding than upstream operators shut in crude supply," so weaker demand for crude at the refineries may help to offset price-bullish supply constraints.


Do you know someone who would benefit from this information? We can send your friend a strictly confidential, one-time email telling them about this information. Your privacy and your friend's privacy is your business... no spam! Click here and tell a friend!





You must be logged in to make a comment.
You can sign up for a membership or get a FREE Daily News membership or log in

Sign up today for an exclusive discount along with our 30-day GUARANTEE — Love us or leave, with your money back! Click here to become a part of our growing community and learn how to stop gambling with your investments. We will teach you to BE THE HOUSE — Not the Gambler!

Click here to see some testimonials from our members!