On Tuesday, WTI Crude finished higher to close with five straight days of gains and nearly doubling in price to close at $24.56. The market is giving back some of those gains in early trading this morning as traders teeter between optimism and pessimism based upon bearish API inventory news.
Prices have been responding to an increase in demand: As some states and cities in the US take careful steps towards reopening businesses and transportation, and as Europe and China return to work. Investors are feeling a sense of optimism as the restrictions on business and personal travel continue to ease.
At the same time, global oil production is dropping due to a deal between OPEC and its allies last month to reduce collective output by nearly 10 million barrels per day. In addition, shut ins from US producers are also cutting into the national and global supply glut.
The API’s data last night:
The API reported a larger-than-expected build for crude of 8.4 MMbbls versus an expected growth of 7.9 MMbbls. At Cushing, stocks rose by 2.7 MMbbls. The API reported that gasoline had a surprise draw 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 $23.31, a loss of $1.25.
Fuel is down in early trading this morning. Diesel is trading at $0.8701, a loss of 2.6 cents. Gasoline is trading at $0.8825, a loss of 1.9 cents.