Crude Oil Inventories Post Surprise Build, Trim Day's Rally
Weekly crude stocks rose 2.01M barrels versus a drawdown forecast, pulling oil off its session high near $88.61.
The Energy Information Administration just handed oil bulls a gut-punch. Crude inventories built by 2.01 million barrels this week when traders were positioned for a draw of 1.052 million. That's a miss of over 3 million barrels — and it wasn't a one-off shock. Private data the night before already telegraphed a surprise build of 2.603 million barrels for crude, so the smart money had a heads-up.
It wasn't just crude. Gasoline stocks added 0.765 million barrels against an expected draw of 1.5 million-plus. Distillates came in at a build of 1.395 million versus a forecast of just 0.738 million. Across the board, supply is fatter than the market wanted to see.
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Here's the thing though — crude is still up $2.70 on the session, trading around $87.07 at the time of the report. The inventory data knocked it off the intraday high of $88.61, but the bulls haven't folded. Watch the 50% midpoint of the selloff from the May 18 high — that's your key support level. If price holds there, the dip buyers stay in control. If it cracks, you've got a cleaner short setup with the bearish inventory data as your fundamental backstop.
Bottom line: the supply picture is looser than expected on multiple fronts. That limits upside conviction, even if geopolitical tailwinds are still propping up the tape. Trade the levels, respect the data.
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