Image credit: A/S Global Risk Management

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The weekly oil stocks data from the American Petroleum Institute (API) showed a huge build in crude oil stocks of 7.8 mio. barrels. The more closely followed oil inventory report from the Energy Information Administration (EIA) is published this afternoon and consensus is a 3.2m-barrel build in crude, draws in gasoline and distillates stocks. The last six weeks have shown builds in crude oil stocks - quite contrary to same period last year, which mainly saw draws in crude oil stocks. Expect some volatility around the publishing.

The U.S. sanctions against Iran have taken effect, but as 180-day waivers were granted to eight countries importing up to three-quarters of Iran's seaborne oil exports, the sanctions have not yet caused oil price spikes this week. Also, Iran stated that the oil-rich country has been able to sell as much oil as it needs to. Turkey, one of the countries granted waivers, however, stated that it will not comply with the sanctions.

The International Energy Agency's (EIA) executive director is cautious about the current supply/demand balance and yesterday warned that the oil market is "not out of the woods yet".