This Week’s Crude Oil Inventories Are In……

As my colleague Arslan mentioned earlier on in the session, the API and EIA crude oil inventories are out for this week. As has been the theme for the past few days, the impact of Hurricane Harvey is most certainly felt in the crude oil markets.

Harvey Has Caused Havoc In The Gulf Coast Petroleum Industry

With all of the volatility and participation, there have been some premium trading opportunities. In fact, a great trading signal in USOIL closed a winner during the U.S. overnight session here on FX Leaders.

Check with the live trading feed throughout the trading day for ideas and updates related to this explosive market.

Inventory Numbers

The API and EIA inventory numbers came out and the interpretations have been mixed. Below are the hard statistics:

Report                                    Previous           Projected           Actual

API Crude Oil Stock               -3.59M                 NA                     -5.78M

EIA Crude Oil Stocks             -3.327M            -1.908M               -5.392M

Conventional wisdom towards natural disasters influencing crude oil pricing leans towards the bear. Hurricane Harvey has taken the Gulf Coast’s refiners offline. Accordingly, this is will lead to stockpiles of crude, thereby driving pricing down.

However, this point is debatable. Over 25% of U.S. drilling operations in the Gulf Of Mexico have been shut down as a result of the storm. A considerable number of crude oil storage facilities have also been compromised as a result of Harvey's wrath.

While many analysts are calling for a bearish market, there may be enough fundamentals present to keep any panic selling in check. When coupled with concerns over North Korea, the long-term impact on Texas crude oil storage capacity may inhibit future supply and production levels.

These factors alone may ultimately lead bulls into the market.

ABOUT THE AUTHOR See More

Shain Vernier

US Analyst

Shain Vernier has spent over 7 years in the market as a professional futures, options and forex trader. He holds a B.Sc. in Business Finance from the University of Montana. Shain's career includes stretches with several proprietary trading firms in addition to actively managing his own accounts. Before joining FX Leaders, he worked as a market analyst and financial writer.

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