Unexpected Oil Inventory Rise Takes A Bite (USO, OIL)
Oil may have just gotten some wind taken out of its sails after flirting with $50.00 per barrel late yesterday. The DOE just released its weekly inventory data showing another build across the board. Crude rose another 2 million barrels…
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We were expecting only 1 million barrels crude oil inventories and were even expecting a decrease in gasoline inventories. All of this was with refineries running at 82.1% capacity rather than the 82.7% seen the week before. Imagine what these increases in inventories would have looked like if our refineries were just running at the same capacity as before. This is continued demand erosion, which we keep seeing met by supply erosion in the number of rigs that get idled each week and month.
We have seen an immediate reaction in the controversial ETF, the United States Oil (NYSE: USO), where shares are now down 3% at $28.50. Even the iPath S&P GSCI Crude Oil Total Return Index ETN (NYSE: OIL) is down 3% at $18.50 after the news.
JON C. OGG
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Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.
McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.
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A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.
TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.
McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.
