Oil sinks after DOE's report showing inventories rised

Oil sinks after DOE's report showing inventories rised

Oil benchmarks have been hit by a strong wave of selling in the past half hour after the latest DOE inventory release supported last night’s API reading in showing a rise in US stockpiles. The headline rise of 2.5M barrels was far above the 0.5M drawdown expected and even further above the previous print of -2.5M. 

Alongside the increase in the headline number some components of the report were also negative for the oil price. The gasoline inventories increased to 0.0M from the expected -1.7M and the previous print of -2.7M. Whilst the distillate reading showed a small build of 0.1M, below the +0.5M and +1.9M prior this is something of a side story an the overall view is that this latest report is fundamentally bearish for the market. 

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 This is shown in in the immediate reaction seen in both Brent and WTI, with the latter falling by around 80 cents in the half hour following the release. 

 

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