Oil weekly climb

[Old-Ruffneck + 1,177]

Crude oil prices dropped today after the Energy Information Administration reported what can only be described as a colossal crude oil inventory build of 21.6 million barrels for the week to February 26.

This was in stark contrast to the estimated 7.356-million-barrel build reported by the American Petroleum Institute and analyst expectations of an inventory draw of 1.85 million barrels. For the previous week, the EIA had estimated a crude oil inventory build of 1.3 million barrels.

The market yesterday shrugged off the API estimate of a crude inventory build thanks to a massive draw in gasoline stocks, at 9.93 million barrels and a similar-size decline in middle distillate stocks. Both draws resulted from refinery outages caused by the Texas Freeze that hit the state in February, hurting its oil and gas production and refining operations.

The EIA reported a 13.6-million-barrel decline in gasoline stocks for the last week of February, and an average production rate of 8.3 million bpd. This compared with virtually unchanged gasoline stocks—at 257.1 million barrels—for the third week of the month and a production rate of 7.7 million bpd.

So I put the API and EIA in the same class as weather forecasters. NO WAY they should be that far off on estimating "draws" and "builds". There be some rats on the ship me thinks.

 

Edited March 3, 2021 by Old-Ruffneck
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[Gerry Maddoux + 3,627]

The API and EIA have always been "trading houses," whereby they legally predict and report estimates, but at the same time many of the people involved in this charade make trades on the real numbers. These are self-serving mechanisms for a group of pirates. 

They should both be banned from reporting. They move markets. But usually erroneously. 

This is not reporting, or even influence peddling, but merely pump and dump.

One thing you can take to the friggin' bank: America is opening up, the world is opening up, the vaccines are working and the virus numbers are falling like a stone and the world is opening up. There is a pent-up desire to travel. Last year was the "Year of the House," and housing prices went through the roof. This year will be the "Year of Travel." And people are going to draw down the stores of crude oil and gasoline and aviation fuel and low-sulfur shipping fuel like never before. 

In short, it doesn't make a tinker's dam what the API and EIA says--but it never has. Oil and gas are going to be under tremendous demand. This decade will be known as the "Decade of Electricity." Lots of this will be obtained from natural gas.