We have just seen this week’s latest Department of Energy weekly oil inventory data. The new report is on the heels of a sudden rise in oil prices followed by an almost just as sudden drop in oil prices this week. Fortunately for the consumer, there was a rise in the key inventory data we follow. The question is if it is enough of a gain to keep oil as a commodity from attracting too much in new investment dollars. We are watching the Oil Services HOLDRs (NYSE: OIH), the Ultra Oil & Gas ProShares (NYSE: DIG), the United States Oil (NYSE: USO) ETF and the iPath S&P GSCI Crude Oil Total Return Index ETN (NYSE: OIL) reactions based upon the supply data. At 10:41 AM EST we have NYMEX WTI Crude down by $1.35 at $78.20 (down from the $79.75 level after inventory a week ago).
The Department of Energy showed a build up in crude oil by 778,000 barrels, but that is will under the 1.7 million Dow Jones had expected. We were looking for approximately 1 million barrels after speaking with traders. Gasoline inventories also rose in a reverse of prior weeks with a gain of +1.619 million barrels. The good news on gasoline is that Dow Jones had estimates of -1.1 million barrels and we were going to be happy with anything that was not in the red.
Distillates fell by -2.134 million barrels. And the refinery capacity is up again but still low on average at 81.8% after 81.1% a week ago.
The Oil Services HOLDRs (NYSE: OIH) is down 2.4%% at $120.78, the Ultra Oil & Gas ProShares (NYSE: DIG) is down 2.35% at $35.57, the United States Oil (NYSE: USO) ETF is down ‘only’ 0.9% at $40.22 and the iPath S&P GSCI Crude Oil Total Return Index ETN (NYSE: OIL) is down ‘only’ 0.9% at $26.57.
JON C. OGG