The energy complex ended the day with mixed performance. WTI crude oil rose to as high as 67.3 before pulling back and settling at 66.71, -0.2% as US consumer confidence index was worse than expected. The API inventory report showing crude builds further depressed oil price. For product prices, heating oil added +0.6% to 1.7 while RBOB gasoline dropped -0.6% to 1.63.
US consumer confidence index by the Confederation fell to 53.1 in September from 54.5 in the prior month as the employment situation remained poor. The labor market differential dropped to -43.6% in September from -40% in August. The measure represents the difference between the proportion of people saying jobs are plentiful has and the proportion of people saying jobs are difficult to find and the more negative the figure points to a worse job market. Historically, a decline in the difference signaled an increase in unemployment rate.
Stock markets in the US ended the day lower despite brief rebounds in early morning. Dow Jones Industrial Average slid -0.5% to 9742. S&P 500 Index fluctuated between gains and losses but eventually lost -0.2% to 1061.
After market close, the industry-sponsored API reported that crude oil inventory increased +2.76 mmb, compared with consensus of +1.21 mmb, to 340 mmb in the week ended September 25. The build was driven by surged in imports together with decline in refinery runs. Gasoline stockpile unexpected dropped -1.72 mmb (consensus: +0.84 mmb) to 212.5 mmb as demand rebounded. As usual, distillate stockpile gained, by 2.29 mmb last week, to170.7 mmb.
In the oil report to be released in US session today, the US Energy Department will probably show crude inventory built +2 mmb while gasoline and distillate stockpiles rose +1 mmb and +1.2 mmb respectively.
Gold price fell to as low as 984.7 yesterday amid USD’s strength. However price recovered and closed at 993.1, +0.1% for the day. However, others in the precious metal complex slipped with silver losing and platinum losing -0.1% and -1% respectively.
US Oil Inventory
| Weekly change in inventory as of 25/09/09 | Change | Market Expectation | Previous |
| Crude oil | +2.00 mmb | +2.86 mmb | |
| Gasoline | +1.00 mmb | +5.41 mmb | |
| Distillate | +1.20 mmb | +2.96 mmb |
Comparison between API and EIA reports:
API (Sep 25) | EIA (Sep 25) | |||||
Actual | Inventory | Previous | Forecast (using API’s inventory level) | Inventory | ||
Crude oil | +2.76 mmb | 340.0 mmb | +0.28 mmb | +4.39 mmb | 340 mmb | |
Gasoline | -1.72 mmb | 212.5 mmb | +3.82 mmb | -0.11 mmb | 213 mmb | |
Distillate | +2.29 mmb | 170.7 mmb | -1.88 mmb | -0.05 mmb | 171 mmb |
API collects stockpile information on a voluntary basis from operators of refineries, bulk terminals and pipelines. The government requires that reports be filed with the Energy Department (EIA)for its weekly survey. Oil inventories from the API and EIA moved in the same direction for over 70% of the time, using data in the past 4 years.
Source: Bloomberg, API, EIA
Source: Oil n Gold