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WTI Extends Gains After API Reports Large Crude Draw

WTI Extends Gains After API Reports Large Crude Draw

Flip-flopping headlines from OPEC+ leaks and China COVID restrictions prompted a volatile day in crude markets today but WTI ended higher.




OPEC+ does “not like contango and that is what has raised market expectations of deeper cuts,” Amrita Sen, chief oil analyst at consultant Energy Aspects, said in a Bloomberg TV interview.



“I’m not ruling out deeper cuts -- that’s of course on the table -- but I would say that’s not our base case.”




Earlier in the session, prices rallied above $79 a barrel after Beijing said it would bolster vaccination among seniors then prices briefly flirted with losses after Reuters reported that the production cartel would stick with its current oil-output policy



API




  • Crude -7.85mm (-2.49mm exp) - biggest draw since April 2022




  • Cushing -150k




  • Gasoline +2.85mm




  • Distillates +4.01mm



This is the 3rd sizable crude draw in a row...and the 3rd straight week of sizable product builds...





Source: Bloomberg



WTI was hovering around $78.50 ahead of the API print and extended gains after...





Notably, the shape of the futures curve has flipped in recent weeks, continuing to signal an oversupplied market.





Source: Bloomberg



That is the largest contango since 2020.



Tyler Durden
Tue, 11/29/2022 - 16:36