API Reports Big Draw - Oil Markets Daily

| About: The United (USO)

Summary

API reports a big draw.

All categories saw a big draw.

EIA will be the one that moves oil prices.

The American Petroleum Institute (API) publishes an estimate of the weekly EIA crude oil inventory report at 4:30 PM every Tuesday.

Before we go on, please read this quick fact versus myth section from the API website.

Click to enlarge

The big difference between the two is that API data submission is voluntary, while EIA data reporting is mandatory. Nonetheless, oil (NYSEARCA:USO) markets move up and down in response to API's report.

This week's figures look like this:

We don't think these estimates are true again, unless imports drastically fell off. The accuracy of the two tend to correlate with one another over the long run, but short-term misreporting happens frequently.

Take the last two weeks' API data versus EIA data, for instance.

API for 6/17/16:

EIA for 6/17/16:

And the week before that, we wrote an article on it.

Hopefully, that gives you a bit more color on API's recent estimates. We think petroleum products should see a build with crude stock declining, but it depends quite a bit on imports.

Last week, imports saved the day with imports of 8.439 million b/d. If imports come in the mid 7s, we could see a big draw.

Nonetheless, it's always good to keep an eye on all things oil, and we hope you take the API estimate with a grain of salt.

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