Dollar weakness and some OPEC jawboning helped WTI/RBOB rebound today after a week of pain into the API print, but after a bigger than expected crude build, WTI and RBOB spiked higher (thank you algos) before sliding lower…

“The question about production cuts is the hammer that really drove the market lower,” said Gene McGillian, a market research manager at Tradition Energy in Stamford, Connecticut. “Unless we get signs that more oil is going to come onto the market than initially figured, we’ll probably stabilize here.”

API

• Crude +1.001mm (+450k exp)

• Cushing -132k

• Gasoline -1.682mm

• Distillates +1.466mm – biggest build since Feb

After last week’s surprisingly large crude build expectations were for another – albeit smaller – build this week, but in fact API reported a bigger than expected (and unseasonal) crude build… Notably distillates saw their biggest weekly build since Feb…

WTI/RBOB rallied into today’s API print then the machines went crazy – instantly spiking higher before tumbling back lower on the biggee than expected build

“What we’ve seen is a bit of liquidation of longs a few days ago. The market oversold,” said Bart Melek, head of global commodity strategy at TD Securities in Toronto. “Our position continues to be OPEC will try to compensate for any losses from Venezuela and potentially Iran, and above all, it will try to keep stability in the market.”