Crude oil inventory surged +2.42 mmb, higher than market expectation of +1.56 mmb, to 331.4 mmb in the week ended February 5. We believe this was driven by decline in refinery runs. Fortunately, Cushing stock drew for the 7th consecutive week, providing support for WTI crude oil price.

Gasoline stockpile rose +2.32 mmb to 230.4 mmb, compared with consensus forecast of a modest increase by +0.6 mmb. Distillate inventory also missed expectation by drawing -0.36 mmb only.

WTI crude oil plunged to as low as 72.66 shortly after the report but price rebounded to 73.5 afterwards. Trades in heating oil and gasoline showed similar patterns. Heating oil held above 1.9 and recovered to 1.916 while gasoline dropped to 1.8716 before rising above 1.9 immediately.

Weekly change in inventory as of 05/02/10 ActualChangeMarket Expectation Previous
Crude oil 331.4 mmb+2.42 mmb+1.56 mmb+2.32 mmb
Gasoline 230.4 mmb+2.32 mmb+0.60 mmb-1.31 mmb
Distillate 156.2 mmb-0.36 mmb-1.55 mmb-0.95 mmb

Comparison between API and EIA reports:

     

  API (Feb 5   EIA (Feb 5 )  
 ActualInventoryPrevious Forecast (using API's inventory level)Inventory
Crude oil+7.20 mmb339.6 mmb+4.7 mmb +11.0 mmb 340 mmb
Gasoline+1.60 mmb228.8 mmb-1.2 mmb +0.88mmb 229 mmb
Distillate-1.50 mmb158.9 mmb-1.0 mmb +2.45 mmb 159 mmb
     

API collects stockpile information on a voluntary basis from operators of refineries, 76% of the time, using data in the past 4 years.

Source: Bloomberg, API, EIA

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