On Tuesday, WTI Crude jumped higher on news that Saudi Arabia and Russia reached a preliminary agreement to extend the current supply quotas for another month before tapering back cuts. A bullish API inventory report also helped to lift markets. Crude is down in trading this morning after yesterday brought prices to their highest levels since March.
Although some members sought an early OPEC+ meeting to review cut extensions, that meeting is now being doubted due to cheating on supply quotas by some cartel members. Bloomberg reported Thursday’s meeting is unlikely unless OPEC+ resolves compliance problems. A production cut extension had been priced into the market already, so this pessimistic news is putting downward pressure on markets.
The API’s data last night:
The API reported a surprise draw for crude of 0.5 MMbbls versus an expected build of 3.0 MMbbls. At Cushing, stocks drew by 2.2 MMbbls. The API reported that both gasoline and distillates had a larger-than-expected increase. The EIA will report numbers later this morning.
Crude prices are down this morning. WTI Crude is trading at $36.69, a loss of 12 cents.
Fuel is down in early trading this morning. Diesel is trading at $1.0721, a loss of 2.0 cents. Gasoline is trading at $1.1133, a loss of 0.5 cents.