WTI/RBOB Spike On OPEC Headlines After Bearish Inventory/Production Data

Update: WTI/RBOB was fading after DOE data but then Kuwait dropped the following meaningless headline: OPEC JMMC RECOMMENDS EXTENSION, DIDN"T FINALIZE DURATION. And the algos took over...

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Last night"s API-reported surprise crude build sparked selling that not even Russia/Saudi jawboning could rescue, but DOE data showed the exact opposite with a big crude draw and even bigger gasoline draw. Added to a new record high in US crude production and RBOB is fading and WTI is not rallying.

As Bloomberg reports, the U.S. has proven at least one thing this year with its expansion of crude and products exports: we are becoming more energy independent than ever before.

Last week net imports of all crude and refined products dipped to a new record low.

That"s coupled with record-high gasoline exports, a truly spectacular sea change in our world"s oil flows.

API

• Crude +1.82mm (-2.95mm exp)


• Cushing -3.178mm - most since Sept 2009


• Gasoline -1.529mm (+1.2mm exp)


• Distillates +2.696mm (+200k exp) - biggest since July

DOE

• Crude -3.43mm (-2.95mm exp)


• Cushing -2.914mm - biggest draw since Sept 2009


• Gasoline +3.63mm (+1.2mm exp) - biggest build since July


• Distillates  (+200k exp) - biggest buils since Jan

DOE data showed the exact reverse of API with big surprise draw in crude and build in gasoline... Additionally Cushing saw the biggest destocking since Sept 2009 last week...

US crude production rose 24k b/d - to a new record high...

Gasoline exports hit a record high...

 

WTI was lower and RBOB higher heading into the DOE data but the trend reversed after on the surprise bearish product builds...

What Will Stocks Do Under A New Fed Chair?

Via LPLResearch.com,

President Trump is reportedly set to announce his selection for the next Chair of the Board of Governors of the Federal Reserve (Fed) in the very near future, with Jerome Powell emerging as the likely nominee.

Though he’s yet to make a final decision, reports suggest that a final decision will come before November 3.

In our latest Bond Market Perspectives, we took a dive into the potential shift in composition of Fed members in 2018, in addition to the chair, and why it could be quite hawkish—but what does new Fed leadership really mean?

Per Ryan Detrick, Senior Market Strategist, “Just as a new President brings uncertainty, a new Fed chair can do the same. In fact, going clear back to Charles Hamlin (the first Fed chair) in 1914 and his 14 successors, the Dow is down on average six months after a new chair.”

Keep in mind that the sample size is quite small and the results below are skewed due to WWI, the Great Depression, and the crash of 1987.

We’re not suggesting that a new Fed chair is likely to trigger a sharp selloff, but it would add to market uncertainty, and markets don’t like uncertainty.

So we wouldn’t be surprised if Trump’s announcement spurs a bout of volatility, but when we look at the bigger picture, we continue to see very few signs of the excesses seen at previous major market peaks. This suggests very low odds of a recession beginning over the next 12–18 months and a likely continuation of the equity bull market in 2018.

Mapping The Most (And Least) Valuable States In America

Everyone knows location is the most important part of real estate. You can’t change where your house is (all things being equal). You have to consider school districts, crime rates, commute times—the list goes on and on. It can be much simpler when you’re considering buying a home to compare apples to apples so you can see how the real estate market differs according to location.

So HowMuch.net created a new visualization showing land and housing prices at a glance.

Source: HowMuch.net

The blue dots represent the value of an acre of land, and the red circles indicate the median value of a home. The bigger the blue dot and the larger the red circle, the more expensive it is to become a property owner. Small circles and dots likewise indicate a very low cost of purchasing property. The home values are from the U.S. Census Bureau’s 2015 American Consumer Survey, and the numbers behind the land values come from the Bureau of Economic Analysis.

As HowMuch.net notes, several things stand out in our illustration.

An acre of land is much more valuable in the Northeast compared to any other part of the country. This is partly because the Eastern seaboard is a very densely populated area with several large cities, most notably New York. It is also a historical artifact that Europeans settled New England first and then moved west, meaning that New York and Massachusetts have some of the oldest modern structures anywhere in the U.S. In other words, Eastern cities are a lot older than Midwestern cities, so there isn’t a lot of farmland for suburban expansion anymore. We should also mention that in terms of geographic size, these are some of the smallest states in the country. Matter of fact, the three states where the cost of an acre of land is greater than the median price of a house are all located on the East Coast, and they happen to be some of the smallest states in the Union (Rhode Island, Connecticut, and New Jersey).

Median home values (the red circles) are a different and more complicated story. California has the most expensive houses by far ($449,100). Oregon and Washington boast similarly high housing valuations as well ($264,100 and $284,000, respectively). It is also expensive to buy a home on the East Coast with six out of the top ten states with the most expensive median home values.

But there’s a noticeable dip in both housing and land prices in southern and midwestern states. Prices slowly rise the further you move from east to west. This highlights unique economic developments over the last several years, including the boom in oil exploration in North Dakota and the growth of Western cities thanks to young people,like Denver. Snowbirds also tend to move to Florida and Arizona after they retire, which also pushes up housing prices in those places.

Top 5 Most Expensive States to Buy a Home 

1. California - Value per acre: $39,092; Median Home Value: $449,100


2. Massachusetts - Value per acre: $102,214;  Median Home Value: $352,100


3. New Jersey - Value per acre: $196,410; Median Home Value: $322,600


4. Maryland - Value per acre: $75,429; Median Home Value: $299,800


5. New York - Value per acre: 41,314; Median Home Value: $293,500

Top 5 Cheapest States to Buy a Home

1. West Virginia - Value per acre: $10,537; Median Home Value: $112,100


2. Mississippi - Value per acre: $5,565; Median Home Value: 112,700


3. Arkansas - Value per acre: $6,739; Median Home Value: $120,700


4. Oklahoma - Value per acre: $7,364; Median Home Value: $126,800


5. Kentucky - Value per acre: $7,209; Median Home Value: $130,000

All this shows that the laws of supply and demand are alive and well in the real estate market. You can easily find cheap acres of land where they are plentiful and un-useful (sorry, Nevada), but owning property is a lot more expensive in smaller places crowded with lots of people. As always, location, location, location.

WTI Algos Uncertain After Gasoline Inventories Draw But Crude Production Surges

WTI crude prices managed to scramble back up to pre-API-tumble levels ahead of DOE"s data dump this morning with all eyes on gasoline inventories, which did not disappoint showing a small draw (in line with expectations) along with crude"s draw which was roughly in line with API and expectations. Production continues to rise to highest since July 2015.

API

• Crude -3.595mm (-3.5mm exp)


• Cushing -462k (+300k exp)


• Gasoline +1.402mm (-1mm exp)


• Distillates +2.048mm

DOE

• Crude -3.33mm (-3.5mm exp)


• Cushing -503k (+300k exp)


• Gasoline -1.22mm (-1.25mm exp)


• Distillates +28k

Builds in products (gasoline and distillates) according to API is weighing on markets (and a big shift from last week"s massive crude draw), but DOE data showed a draw for gasoline (in line with expectations) and a draw for crude (in line with expectations)

Total Crude Oil Inventories dropped to the lowest since Jan 2016... But as is very clear, remains dramatically over-stocked relative to pre-2015 norms...

One crucial data point that Bloomberg"s Javier Blas notes: total U.S. oil stocks (which includes crude, refined products and the volatile "other oils" category) were unchanged last week. That"s not what the bulls need.

Amid all the bluster, we found it ironic that Crude imports from Venezuela climbed 52 percent to 987,000 barrels a day, also the most since April.

U.S. Fuel Demand Fell 0.72% in Past Four Weeks

Despite stabilization in rig counts, US crude production continues to trend higher, jumping to its highest since July 2015 last week...

A weak dollar and some BTFDing in stocks managed to scramble WTI up to the pre-API levels ahead of the DOE data... (NOTE: futures puked a little right before the print). After the data, the machines were confused but the trend for now is higher as $48 stops are run...

But its mostly noise as the algos cant decide which way to trend for now.

Bloomberg Intelligence energy analyst Vince Piazza sums up the mixed picture:

The crude stockpile drop was basically in line with mean estimates.

The net draw across the petroleum value chain is a modest positive.

However, a drop in refinery utilization foretells ebbing of demand, as driving season comes to an end.

The bearish view is reinforced by output above 9.5 million barrels a day and pushing higher, based on management commentary from 2Q earnings calls.

WTI/RBOB Slide After Oil Production Surge Offsets Biggest Crude Draw Since Sept

Following last night"s mixed mesage from API (crude draw, gasoline build), WTI prices have gone nowhere as all eyes focus on DOE data this morning. Confirming API"s trend, crude saw its biggest draw since Sept 2016 but Gasoline, Distillates, and Cushing (most since March) saw builds which upset the machines and sent prices lower. Crude production rose once again to its highest since July 2015.

API

• Crude -9.2mm (-3.38mm exp) - biggest draw since Sept 2016


• Cushing +1.7mm (+700k exp) - biggest build since March


• Gasoline +301k (-450k exp) - second weekly build in a row


• Distillates -2.1mm (-250k exp)

DOE

• Crude -8.945mm (-3.38mm exp) - biggest draw since Sept 2016


• Cushing +678k (+700k exp) - biggest build since March


• Gasoline +22k (-450k exp)


• Distillates +702k (-250k exp)

Last week"s surprise build in gasoline (confirmed by API) and big draw in crude (also confirmed by API overnight) remains the big focus and DOE data confirmed it with the biggest crude draw since Sept 2016 but builds in products and at Cushing...

While the builds in produst were modest, they were nevertheless a surprise shift in trend from draws to builds...

Imports from Saudi Arabia jumped 47 percent to 813,000 barrels a day, but remain well under the 1-million barrel figure exceeded through much of the first two quarters of this year.

As Bloomberg"s David Marino notes, the total stockpile draw of 7.32 million barrels brings inventories to the lowest since January 2016, but still more than 200 million barrels above November 2014, when the glut really started building up. A lot of work still to do, as OPEC well knows.

Some more details, courtesy of Reuters: total commercial stocks fell -8.9 million bbl to 466 million bbl in the week to Aug 11 (much faster than normal at this time of year).

Total stocks are now -25 million bbl below 2016 level but... +134 million bbl over 10-yr average.

Stocks are now down -13 million bbl since start of year compared with +40 million rise in 2016 and 10-yr avg of +25 million, as the rebalancing appears to be taking shape.

Meanwhile, refinery throughput unchanged last week"s record 17.6 million b/d.

One number which the market was closely watching were gasoline stocks, which disappointed the bulls by rising fractionally by 22kb, and basically unchanged at 231 million bbl, despite an expectation of a 1mm decline.

As a result, gasoline stocks are now 2.3mm bbl below similar levels last year, but are 19 mm bbls above the 10 year average.

Finally, while domestic production increased again, so did imports, which accelerated by +364,000 b/d to 8.1 million b/d in the week to Aug 11

While rig count growth has stabilized, crude production continues to rise in the Lower 48 (though had dropped in Alaska for 3 straight weeks) but both saw a rise this week (total production up 79k) as Lower 48 production hit its highest since July 2015...

Bloomberg notes that U.S. oil production from major shale plays is set to hit another record at 6.15 million barrels a day next month, according to the EIA. It"s not just the Permian that"s growing, as the agency sees higher output across the board.

WTI Crude prices barely budged from last night"s API print heading into the DOE data, spiked higher on the crude draw but slipped back lower on product builds and production surge...

Heading into the print, "the size of a potential draw in crude inventories is “going to be the most material” aspect of the report, Brad Hunnewell, senior equity analyst at Rockefeller & Co., says, adding that "investors also expect to see a rise in gasoline demand."

However, as Bloomberg Intelligence energy analyst Vince Piazza notes:

No change to our bearish view: long road to recovery still ahead. We still see mid $50-$60s as the threshold for acceleration of U.S output. Commentary from exploration and production company conference calls implies drilling efficiencies are aiding productivity.

Elevated refining utilization has helped deplete bloated inventories across the petroleum value chain during the key seasonal driving period, and exports have helped as well. However, the market is seeing the end to summer, with runs traditionally declining in early fall.

WTI Jumps Back Above $47 After Crude Draw; Production At Highest Since July 2015

After API"s surprise crude build, DOE dashed bears" hopes with a bigger than expected crude draw (-4.727mm vs -3.5mm exp) as the entire energy complex was inventoires decline. WTI prices kneejerked back above $47 on the proint but stalled a little as once again production jumped (to its highest since July 2015).

API

• Crude +1.628mm (-3.5mm exp)


• Cushing +608k


• Gasoline -5.448mm (-1.3mm exp)


• Distillates -2.888mm

DOE

• Crude -4.727mm (-3.5mm exp)


• Cushing -23k


• Gasoline -4.445mm (-1.3mm exp)


• Distillates -21.37mm (+1.2mm exp)

Amid peak demand season, the large gasoline draws are unsurprising but the bid crude draw (especialy compared to API"s build) was a bullish surprise...

The latest 4.7mmbbl draw dragged down commercial stocks to 491 million, approaching the top end of the historical range.

With the latest draw, YTD crude stocks are now just 1.1mm barrels above 2016 levels, although as Reuters notes, still 154MM bbl above the 10Year average:

From the start of the year, commercial stocks are up 11 mm bbls, compared to a 38mm bbl increase in 2016, 81mm in 2015 and +29mm in the last 10 years.

Meanwhile, total imports rebounded from last week"s 7.6mm bbls to 8.0mm in the latest week.

Overall, much is being made of the notable decline in US stockpiles since its peak in late March, however, as the chart below shows, US Crude stockpiles remain 37% above historical average...

Of course, last week it was the resurgence in US crude production that stymied bullish exuberance at inventory draws. After rebounding last week, it looks like the Alaskan component of US oil production slowed this week as maintenance work continues in the Alaskan North Slope, but the Lower 48 saw production hit 2 year highs...

And demand slumped...just when seasonally it should be surging

The crude draw last night sent prices kneejerking lower but WTI has leaked higher overnight, testing $47 once again prior to the DOE data. As the data hit, machines ran stops and burst WTI through $47...

But the biggest highlight of the report, at least according to Bloomberg, is the collapse in Saudi shipments into the U.S., with last week arrivals at a 7-year low of just 524,000 barrels a day, down from 851,000 the previous week.  That"s the lowest weekly U.S. imports from Saudi since June 2010.

"Riyadh has promised to cut supplies this summer to the market that traders care the most (and where the data is most visible) and it seems to be delivering. If the trend holds, it could put upward pressure on prices... Saudi oil minister Khalid Al-Falih promised big cuts and he"s delivering."

SCOTUS Travel Ban Decision Summarized In 1 Cartoon

Giving credit where credit is due (while the bile rises into the back of my throat).

Ramirez draws good propaganda while pushing the neocon agenda.

I"m sure he gets the double-digit IQ morons to go into knee-slapping, hysterical fits of laughter whenever he posts one of his absurd political cartoons.

"Yep! Herp a derp! He"s right! Murrca! Fuck yeah!"

Too bad for them that Ramirez is laughing hysterically at those same morons while he counts his filthy shekels.

Oscars Preview

I don"t think we are just whining and complaing. I wouldn"t call Jewish Satanism successful...its crippling its host and turning it against the parasite...maybe now it appears successful, but in twenty years, the Jewish parasite may be a very unsuccesful thing. We are educating and organizing to expel the parasites, the Jewish, communist, socialist, GLBT, etc from our system so that our nation can heal and gain vitality again. Check out thezog.info and dailystormer.com and jewwatch.com

Get educated, then get involved locally (watch out for antifa!) on dailystormer.com.

The Jews do care what we think. They dedicate the ADL and SPLC and the MSM to oppose us, but we are still growing. We may not win, but we will still give the NWO filth a run for their money!!!!

Oil BTFD Algo "Triggered" For Fourth Consecutive Week

Just as oil was set to test session lows after another massive oil build, sending US crude inventories to all time highs, many were wondering if the same exact algos that struck for the past weeks, would reappear sending oil surging on negative data would hit again. The answer: a resounding yes.

While it is difficult to explain why oil prices are rising, the rally it"s coming on very strong volume as someone clearly thinks it"s time to buy crude, again, and doing so with gusto.

So, bang on at the 3:45 pm London time, the algo emerged, exactly as in the last four weeks when bearish EIA figures also triggered buying.

Just like it did last week...

And the week before...

And the week before that...

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Earlier:

After API"s bigger than expected crude build, DOE confirmed the data with a much-bigger-than-expected 9.5mm build pushing total US crude inventories to a new record high. Along with a large gasoline build, WTI/RBIB prices are tumbling on the print.

API

• Crude +9.94mm (+3.5mm exp)


• Cushing -1.27mm (+500k exp)


• Gasoline+720k


• Distillates +1.5mm

DOE

• Crude +9.527mm (+3.5mm exp)


• Cushing -702k (+400k exp)


• Gasoline +2.846mm (+500k exp)


• Distillates -689k (-1mm exp)

DOE confirmed API"s major build - the 6th weekly build in a row. Gasoline inventories surged again.

Sending US crude inventories to a new record high...

And Gasoline inventories to record highs...

Crude stocks  have risen +38.5 million bbl in first 41 days of the year compared with 10-yr avg rise of just +14.3 million bbl

As Bloomberg"s Javier Blas notes, this time the bulls can not claim that unusually high imports are driving up crude stocks. U.S. refiners last week bought overseas 8.5 million barrels a day, down 881,000 barrels a day from the torrid pace of two weeks ago. On a four-week average, imports are running just 9.9% above last year"s same period.

Furthermore, the U.S. exported last week crude oil at a rate of more than 1 million barrels a day -- a record. That"s way more than the production of several OPEC members, including Libya, Ecuador, Gabon and Qatar.

US crude production continues to rise in trend along with lagged rig counts...

Bear in mind that the last 3 weeks have seen a fundamentally correct reaction lower in WTI/RBOB prices only to be algo panic bid after...

For now crude is bouncing as RBOB crashes....

WTI, RBOB Tumble After Massive Product Inventory Builds

Following API"s larger than expected crude draw (and huge product builds), DOE reports massive builds in Distillates (+10mm - biggest sine Jan 2015) and Gasoline (+8.3mm - biggest since Jan 2016) and another big build in Cushing inventories. Crude inventories drew down 7.05mm barrels - confirming API"s data. US crude production also picked up and WTI prices tumbled.

API

• Crude -7.431mm (-2mm exp)- biggest draw since Sept 2016


• Cushing +482k (+900k exp)


• Gasoline +4.25mm (+1mm exp)- most since Jan 2016


• Distillates +5.244mm (-800k exp) - most since Jan 2016

DOE

• Crude -7.051mm (-2mm exp) 


• Cushing +1.074mm (+200k exp)


• Gasoline +8.307mm (+1mm exp) - most since Jan 2016


• Distillates +10.051mm (-800k exp) - most since Jan 2015

Total crude stockpiles remain over 35% above the five-year seasonal norm.

Crude stockpiles by region:

• Padd 1, 12.4 million, lowest in almost two years.


• Padd 2, 151.5 million, highest since May.


• Padd 3, 240.5 million, second-lowest since February.


• Padd 4, 23.6 million.


• Padd 5, 50.95 million, about 3 million below the 52-week average.

Bloomberg"s Javier Blas warns that - One big caveat reading the data today: there was significant fog last week around the Houston Channel, a key waterway to move both products and crude in and out big refineries. That could have affected the figures.

The other factor disruption this week"s figures, as in December, is the fact that U.S. refiners in Texas and Louisiana try to reduce the size of their stocks to lower their year-end tax bill. As such, crude inventories typically drop in December in the region.

Cushing jumps to the highest level since May with the sixth gain in seven weeks.

Bloomberg notes that much of that draw in crude stocks looks to be attributable to imports which dropped by 984 kbbls/d across the US with 612 kbbls/d of that coming in PADD 3, that"s a 4,284 kbbls/d drop over the week.

US Crude production continues to generally follow the lagged trend of the rising rig count...

Bloomberg notes that U.S. production has been trending higher since September, with the Energy Information Administration sharply increasing its weekly estimates in November and again December. Newly released monthly data for October shows the EIA underestimated output significantly (weekly figures pointed to 8.5 million barrels a day, while the monthly data was of 8.8 million barrels a day).

WTI tagged $54 this morning - higher post-API data - but is dropping after the huge builds...

And Gasoline futures also...