Crude, Products Pop on EIA
Today’s EIA report showed a surprise drawdown of 3.2 million barrels in Crude Oil inventories versus expectations of a 2.5 million barrel build. Further bolstering the bullish Oil data, gasoline and distillate inventories both dropped by much more than expected. Given MasterCard’s report indicating gasoline demand has fallen more than 6.8 percent from the same period last year, the data suggests what many had suspected – while OPEC has not officially cut quotas, individual member nations may be curbing exports to avoid a supply glut. The report really threw a red cape in front of the bulls, with prices surging over two dollars thus far. There is a decent chance that Oil prices will set a new intraday record, but whether or not the market is able to hold above these new record highs remains to be seen. Former Fed Chairman Greenspan’s comments that the U.S. economy is probably in a recession right now has pushed the greenback lower, further supporting commodity prices in general.
Rob Kurzatkowski, Commodity Analyst
