Crude oil spiked higher on August 3
After starting the day on a positive note by gaining in the early morning hours on Wednesday, August 3, crude oil prices inched higher as the day progressed. At 1:25 PM EDT on August 3, the WTI crude oil futures contract for September delivery was trading at $40.76 per barrel, a gain of ~3.2%.
The Brent crude contract for October delivery was trading at $43.02 per barrel, a surge of ~2.9%. This unexpected huge drop in gasoline inventories supported the crude oil price rally today. Please read Crude Oil Rebounds Due to the API’s Inventory Data to learn why crude oil gained in the early morning hours on August 3.
Crude oil gained despite build in crude oil inventories
Crude oil inventories increased in the week ended July 29 against the Market’s expectation of a draw-down. According to the data released by the Energy Information Administration (or EIA) at 10:30 AM EDT on August 3, crude oil inventories rose by 1.4 million barrels in the week ended July 29.
Market expectations
The Market was expecting a decline in weekly crude oil inventory levels by 1.4 million barrels. Despite the surprise build in crude oil inventory levels, prices surged by more than 3% on August 3 as prices were supported by huge drawdown in the gasoline inventory levels.
According to EIA, gasoline inventories declined by ~3.3 million barrels in the week ended July 29. This is better than the Market’s expectation of a drop of 200,000 barrels and offset the crude oil inventory increase.
Producers
At 1:40 PM EDT on Wednesday, August 3, the major crude oil producers Carrizo Oil & Gas (CRZO), Canadian Natural Resources (CNQ), and British Petroleum (BP) gained ~3.5%, ~1.0% and ~0.21%, respectively. Total S.A. (TOT) declined by ~0.19%. The SPDR S&P Oil & Gas Exploration and Production ETF (XOP) and the Power Shares DB Oil ETF (DBO) gained ~3.0% and ~2.5%, respectively.
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After starting the day on a positive note by gaining in the early morning hours on Wednesday, August 3, crude oil prices inched higher as the day progressed. At 1:25 PM EDT on August 3, the WTI crude oil futures contract for September delivery was trading at $40.76 per barrel, a gain of ~3.2%.
The Brent crude contract for October delivery was trading at $43.02 per barrel, a surge of ~2.9%. This unexpected huge drop in gasoline inventories supported the crude oil price rally today. Please read Crude Oil Rebounds Due to the API’s Inventory Data to learn why crude oil gained in the early morning hours on August 3.
Crude oil gained despite build in crude oil inventories
Crude oil inventories increased in the week ended July 29 against the Market’s expectation of a draw-down. According to the data released by the Energy Information Administration (or EIA) at 10:30 AM EDT on August 3, crude oil inventories rose by 1.4 million barrels in the week ended July 29.
Market expectations
The Market was expecting a decline in weekly crude oil inventory levels by 1.4 million barrels. Despite the surprise build in crude oil inventory levels, prices surged by more than 3% on August 3 as prices were supported by huge drawdown in the gasoline inventory levels.
According to EIA, gasoline inventories declined by ~3.3 million barrels in the week ended July 29. This is better than the Market’s expectation of a drop of 200,000 barrels and offset the crude oil inventory increase.
Producers
At 1:40 PM EDT on Wednesday, August 3, the major crude oil producers Carrizo Oil & Gas (CRZO), Canadian Natural Resources (CNQ), and British Petroleum (BP) gained ~3.5%, ~1.0% and ~0.21%, respectively. Total S.A. (TOT) declined by ~0.19%. The SPDR S&P Oil & Gas Exploration and Production ETF (XOP) and the Power Shares DB Oil ETF (DBO) gained ~3.0% and ~2.5%, respectively.
Market swing
Comex signals
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Crude oil futures were mixed during morning trade in Asia on Tuesday, with the NYMEX WTI contract ticking up on expected US crude stock draws.
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