Oil Pares Gains as US Gasoline and Cushing Supplies Rise

Randall Padilla
August 17, 2017

At 466.5 million barrels, crude stockpiles were at their lowest since January 2016. Inventories dropped by 9.2-million barrels last week, the American Petroleum Institute (API) was said to report. October Brent crude LCOV7, -0.26% on London's ICE Futures climbed 19 cents, or 0.4%, to $50.46.

EIA also said refinery crude runs fell by 9,000 barrels per day. Daily gasoline production fell to 10 million barrels, compared with 10.3 million bpd a week earlier.

The EIA is roughly in line with industry data from the American Petroleum Institute, which yesterday reported a draw of 9.2 million barrels in United States crude oil inventories-the biggest draw since September 2016.

Oil futures rebounded some in Asian trading after fresh US selling overnight as weekly output neared 2015's peak last week. Crude oil exports also rose, jumping to 877,000 bbl/d from 707,000 bbl/d.

Opec will not clear the global glut any time soon since any increase in price continues to bolster rival production from U.S. shale, according to the International Energy Agency.

OPEC together with non-OPEC producers including Russian Federation have pledged to restrict output by 1.8 bbl/d between January this year and March 2018.

US output has filled part of that gap.

USA crude production rose to 9.5 million bbl/d from 9.4 million bbl/d in the previous week. While almost 70 million barrels of inventory decreases have been reported this summer, the market is waiting for a signal after the Labor Day holiday, when demand usually tapers, he said.

The US dollar rallied significantly during the Tuesday session against the Canadian dollar, as we continue to see bearish pressure on the oil markets.

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