Sept Contract futures jumped 50 cents on this news:
U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum. Reserve) decreased by 2.5 million barrels from the previous week. At 521.1 million. barrels, U.S. crude oil inventories are at historically high levels for this time of year.. Total motor gasoline inventories decreased by 2.7 million barrels last week, but are well above the upper limit of the average range. Finished gasoline inventories increased while. blending components inventories decreased last week. Distillate fuel inventories. increased by 1.9 million barrels last week and are near the upper limit of the average. range for this time of year. Propane/propylene inventories rose 1.8 million barrels last. week and are at the upper limit of the average range.
Total commercial petroleum. inventories increased by 1.3 million barrels last week.
Put simply, we are running out of places to put stuff. Labor Day in the USA is just around the corner, signaling the end of driving season. After that, gasoline consumption will decline. There is a reason refiners have been getting clobbered lately. Speaking of refiners, maintenance season looms and gasoline production must switch to the winter blend.
Oil production in the US actually increased, which should not be all that surprising as the number of active rigs has been rising all summer. Here in tax-heavy Connecticut 87 Octane is selling for $2.15/gal which means most of the country sans California should be well under $2.
Producers aggressively hedged when futures briefly peaked above $50 earlier this year. Expect more of the same, which is the great catch-22 of the whole game.
Iran is already balking at the notion of freezing OPEC output at current record levels. We saw the same scenario with the failed meeting in Doha.
Saudis and Russians are pumping furiously to maintain market share.
Iraq is moving forward with ExxonMobil and Royal Dutch Shell to ramp up production.
Of course the market makers at sites like investing.com are furiously pumping WTI, Brent, NatGas and even Copper on the news.
Situation Normal, All Fucked Up
