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Big draw on oil inventories, build in distillates (Brent: $40)

Oil prices had a small price blip upwards ahead of the weekly oil inventory report from the Energy Information Administration (EIA). The report showed a huge draw in crude oil, but the bullish news was offset by an even larger build in distillates - see details below - and Brent prices fell to current levels of $40-41. Now oil is down almost $4 from one week ago after Friday’s OPEC meeting failed to produce a production agreement.

Release: EIA oil data (Consensus)

Crude: -3.568M barrels (0.252M)
Distillates:4.998M barrels (2.461M)
Gasoline: 0.786M barrels (2.155M)
Refinery utilization: -1.4%

In Libya, previously a large crude oil exporter, production remains below 0.5 mio. bpd, the two largest oil terminals are still closed due to fighting and unrest in the war-torn country with no likelihood of a soon-to-come solution to the conflicts.

On the economic data front, Bank of England will release its interest rate decision followed by meeting minutes - along with jobless claims and Federal Budget Balance from the U.S. later today. Tomorrow inflation and retail sales will be published and followed closely since it could be an indicator of whether or not the Fed will hike the interest rate at the meeting next week.