WTI Extends Gains After Across The Board Inventory Draws

Oil prices ended largely unchanged on Tuesday as tropical storm Nicholas brought heavy rain and power outages in Texas but caused less damage to U.S. energy infrastructure than Hurricane Ida caused earlier this month.

“The Gulf situation is not resolving itself quickly,” said John Kilduff, partner at Again Capital LLC in New York.

More than 39% of the U.S. Gulf of Mexico’s production of crude and natural gas remained shut on Tuesday, the regulator Bureau of Safety and Environmental Enforcement (BSEE) said. Also of note was the fact that the, now infamous, Colonial pipeline, the largest U.S. fuel pipeline, partially resumed operations after shutting due to a power outage early in the day.

Details on China’s plans to sell crude from strategic reserves pressured prices, but all algos attention will be focused in the short-term on API’s inventory data…

API

• Crude -5.437mm (-3.5mm exp)

• Cushing -1.345mm

• Gasoline -2.761mm

• Distillates -2.888m

Analysts expected crude inventories to fall for the 6th straight week and were correct with a larger than expected crude draw accompanied by draws at Cushing and across gasoline and distillates…

Source: Bloomberg

WTI was hovering around $70.40 ahead of the print and extending gains after the inventory draws…