Oil Traders Ignore EIA Data And Focus On Banking Crisis
- Crude inventories grew by 1.6 million barrels from the previous week.
- Gasoline inventories decreased by 2.1 million barrels.
- Oil markets tested yearly lows as traders focused on the problems of the European banks.
Crude Inventories Exceed Analyst Estimates
On March 15, EIA released its Weekly Petroleum Status Report. The report indicated that crude inventories increased by 1.6 million barrels from the previous week, compared to analyst consensus of 1.2 million barrels. At current levels, crude inventories are about 7% above the five-year average for this time of the year.
Total motor gasoline inventories declined by 2.1 million barrels, while distillate fuel inventories decreased by 2.5 million barrels. U.S. crude oil imports were mostly stable at 6.2 million bpd.
The report showed that domestic oil production remained unchanged at 12.2 million bpd. There were no sales from the Strategic Petroleum Reserve, which remained unchanged at 371.6 million barrels.
Oil Markets Ignore The Report As Traders Stay Focus On Banking Crisis
WTI oil settled near the $68 level as traders remained focused on the banking crisis. It looks that the problems of the U.S. banks may have spread to Europe. Credit Suisse stock tested historic lows today amid bankruptcy fears. Other banking stocks are also under strong pressure. Oil traders are worried that banks’ problems will lead to a recession and decrease demand for oil.
In addition, some funds may be forced to sell their long positions in the oil markets to cover their losses in other markets.
Brent oil has also found itself under material pressure and settled near the $74 level.
For a look at all of today’s economic events, check out our economic calendar.