Image credit: Global Risk Management

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The weekly U.S. oil inventory report from the Energy Information Administration (EIA) showed a huge deviation from expectations with a 3.6 mio. barrel draw in crude oil stocks (0.4 mio. barrels expected). Distillates and gasoline inventories increased slightly where the consensus was draws. So all in all the report was mixed, but markets reacted with a short-term spike. Along with the weekly oil stocks, the EIA reported a record monthly production in March of 10.47 mio. barrels. Brent and WTI crude, the two main benchmarks for crude oil prices, are currently trading with a price difference that is around a 3-year high.

In a letter to the OPEC president, the Iranian oil minister asks for a separate agenda at the summit later this month in Vienna. Iran could become subject to the reimposing of sanctions by the U.S. from November, and this could potentially entail an export reduction of up to 1 mio. barrels per day for the 5th largest country in the OPEC organization.

Turning to economic data, the main topic today will likely be the U.S. imposing tariffs on steel and aluminum from Canada, Mexico and the EU - sparking fears of a global trade war. Traditionally, trade wars lead to weaker economic growth in the countries involved. This could affect oil prices as less growth means less consumption of oil; however, this is more the long-term effects of the looming trade war. The monthly U.S. nonfarm payrolls and unemployment rate is published this afternoon.

Tonight, the weekly oil rig count from Baker Hughes - counting the number of active U.S. oil rigs - will be followed closely for hints of continued increase.