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By Michael Poulson, A/S Global Risk Management

Oil prices were volatile ahead of yesterday's weekly oil inventory report from the Energy Information Administration. Though the report showed surprise draw in crude oil stocks, the huge build in distillates puzzled the markets, but soon sent oil prices downwards. Distillates stocks are now at 6-year seasonal highs. See inventory details below. The crude oil data differed from Tuesday's oil stocks data from the American Petroleum Institute which reported a 1.4 mio. barrel-build. Statistical data shows that 80% of the time the two reports are directionally alligned; this week was then not among the 80%. Reporting to the EIA is mandatory, reporting to the API is voluntary.

Release: EIA oil data (Consensus)
Crude: -0.56M barrels (3.8M)
Distillates: 4.62M barrels (1.54M)
Gasoline: 0.57M barrels (0.34M)
Refinery utilization: -0.8%

Nigeria is expected to resume exports from Nigeria's largest export facility, Qua Iboe, which has been closed since July due to force majeure. Libya could also be about to resume exports; cautious optimism since this message has been read before without actually taking place. Meanwhile, 90,000 barrels per day is offline in Northern Iraq due to pipeline closure.

Turning to economic data, more UK releases are due, including Bank of England's meeting minutes and interest rate decision. U.S. inflation and retail sales data will be published this afternoon and could stir some volatility since growth is an important indicator to the Fed and a potential interest rate hike. The Fed is meeting next week.

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A/S Global Risk Management is a provider of customised hedging solutions for the management of price risk on fuel expenses. The company has offices in Denmark and Singapore. For further details about its risk management products and services, please call +45 88 38 00 00 or email hedging@global-riskmanagement.com.