Conclusion: US petroleum inventories continued to declined rapidly, particularly Cushing stocks. Net imports are again at extremely low levels despite these draws. We believe this will ultimately have to close the WTI-Brent arb. On flat price we have become a bit more cautious as the 20% price increase will soon have an impact on demand while outlook for global production growth look positive for 2018 with a number of new non-OPEC projects coming online and ramping up.
- Very large stocks draws. Total petroleum down 13.3mb, 15.7mb more than normal. Commercial crude drew 6.9mb, Cushing a whopping 4.2mb.
- Implied demand looked strong, up 170kb.d w-o-w, at 20.8mb/d
- Net imports declined by 0.3mb/d, down at 3.3mb/d which is 2.2mb/d below last years levels
- Refinery utilization was down 2.3% w-o-w but the 4 week average of gross and net inputs remain at seasonal record levels
- Crude output was up 260kb.d w-o-w, but the adjustment factor flipped by 970kb/d. As a result, crude oil output was almost at 10mb/d, but the combined crude and adjustment factor dropped sharply.
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