Conclusion: Very large draw of crude and products, which was mainly driven by the record low net import number (mainly due to extremely high exports). While this has accelerated the drawdown in US petroleum stocks, it is less bullish on a global scale. The record exports came amidst the large WTI-Brent differential, but this will likely cool off over the coming weeks as oil trading near the export terminals along the USGC is trading at a large premium to WTI now, mainly due to pipeline constraints. This limits to how much the WTI-Brent gap can close in the short run. However, over the medium term, we believe the global inventory overhang will continue to draw down, pushing oil prices higher and narrowing the WTIO-Brent differential.
- Very large total draw of -12.5mb, 14.5mb more than normal. Crude built 0.9mb, which was 3.4mb less than normal (and includes a 0.3mb SPR release). Products drew heavily, gasoline and distillates alone over 10mb.
- Implied demand jumped 0.9mb/d which brings it back to last years levels.
- Total net imports declined sharply again by 0.7mb/d to just 2.2mb/d. Total imports actually increased 0.1mb/d but total exports jumped 0.8mb/d to an all time high of 7.7mb which makes the Us one of the largest exporters in the world
- Refinery utilization increased 3.3% this week, bringing both utilization and input back to last years levels
- Production increased 1.1mb/d a recovery from alast weeks storm related drop. This pushes the weekly production number to 12.04mb/d year-over-year.
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