Oil up despite bearish oil stocks report
12 Jan 2017 08:32 GMT
|By A/S Global Risk Management.|
| By Michael Poulson, A/S Global Risk Management|
The weekly oil inventory report from the EIA showed huge builds. Crude, distillates and gasoline stocks increased way above expectations - see details below. Total crude oil stocks are now 483.1 mio. barrels. However, the bearish news was overshadowed by a weaker dollar and Saudi production cut news - leading to higher oil prices.
Release: EIA oil data (Consensus)
Crude: 4.100M barrels (1.162M)
Distillates: 8.360M barrels (0.899M)
Gasoline: 5.020M barrels (1.638M)
Refinery utilization: 1.6%
Allegedly, Saudi Arabia cut exports to Asian and Indian buyers - market took this as a sign of compliance with the agreed OPEC production cut. OPEC latest survey indicates a drop in total OPEC member production in December of 280,000 barrels per day, mainly due to drops in Saudi and Nigerian oil production. December production was 32.85 mio. barrels per day, versus November's 33.13 mio. bpd.
President-elect Donald Trump held his first press conference yesterday after the election. However, the speech did not reveal any specific details to the timing or scope of his policies and as a consequence, the dollar fell. Inauguration will take place next week (20 January) where he will hold another speech.
Turning to economic data front, today sees a couple of Fed member speeches along with euro zone industrial production and ECB Account of Monetary Policy Meeting; overnight, Chinese trade balance.
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