Large Gasoline Draw Expected - Oil Markets Daily

| About: The United (USO)

Summary

API reported estimates today.

ClipperData expects EIA to report the largest crude draw this week.

Both crude and gasoline could see large draws, which would substantially boost oil prices higher.

API reported its forecast this afternoon, and here's what it expects:

Source: EnergyBasis

The larger than expected gasoline draw makes perfect sense if crude stock builds. However, there are some indications that point to both a large draw in crude and gasoline stock. ClipperData reported a much lower US crude import estimate for last week.

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Source

ClipperData has been particularly accurate in the past as they track shipping traffic in and out of ports. We have always found ClipperData to be a highly credible source. In addition to the sub 5 million b/d import figure, ClipperData also expects the largest inventory draw this year.

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Source

We have always said in our weekly inventory reports that the crude draws have been dampened by significantly higher imports. If crude imports averaged the same as last year, we would've seen much larger scale draws. If imports really did fall below 5 million b/d, and refineries cut back throughput simultaneously, then it's very possible to see a large draw in crude and gasoline.

If the EIA report confirms ClipperData's estimates, then we could see a sharp rally in oil (NYSEARCA:USO) prices tomorrow.

Oil prices leveled off today after nearly a 3% gain on Monday, and all the oil traders we talked to are waiting for the EIA report tomorrow. Some traders have said to us that the import figures should be sharply lower in this week's report. We will just have to wait till tomorrow to confirm.

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