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After fading into the print, WTI rebounded after API reported a bigger than expected crude draw.
API
- Crude -5.17mm (-2mm exp)
- Cushing +195k (+900k exp), Genscape +519k
- Gasoline -930k (-500k exp)
- Distillates +1.8mm (+1.5mm exp)
Last week’s surprise crude build (biggest since March 2017), API reported a big surprise crude draw of 5.17mm. Distillates built more than expected and gasoline drew down more than expected. All in all – a big mixed bag.
WTI also bounced perfectly off its 200DMA…
“You’re seeing somewhat of a relief rally here and part of it is technical in nature for crude,” with oil bouncing off the $65 level and 200-day moving average, said Rob Haworth, who helps oversee $151 billion at U.S. Bank Wealth Management in Seattle.
The contract is rolling and was trading right at the same level as before last week’s API at its peak today before fading into the API print…
But rallied back above $66 (Oct contract) after the data hit…
“The strength is really primarily from the weak dollar and also you’re getting another week of expectations that you will see crude stocks drop,” said Gene McGillian, manager of market research at Tradition Energy. “The fundamental picture is tighter than it was a year ago.”
The United States Oil Fund LP ETF (USO) was unchanged in premarket trading Wednesday. Year-to-date, USO has gained 15.15%, versus a 7.73% rise in the benchmark S&P 500 index during the same period.
USO currently has an ETF Daily News SMART Grade of A (Strong Buy), and is ranked #1 of 111 ETFs in the Commodity ETFs category.
This article is brought to you courtesy of ZeroHedge.
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