Investor's Business Daily is reporting:
A surprise drop in U.S. oil inventories last week, particularly in
the Midwest, in some respects supported recent arguments that WTI crude
oil prices are headed higher.
If accurate, it could bode well for domestic oil producers, including Bonanza Creek Energy and Oasis Petroleum. It also could mean narrower margins for Midwest refiners like Northern Tier Energy and Phillips 66, as well as wider margins for Gulf Coast refiners.
The scenario hinges on the possible breakdown of the long-term supply
glut at the pipeline hub where the benchmark is priced, in Cushing,
Oklahoma.
A March 14 report from Robert Campbell, a Thomson Reuters analyst,
contends that, despite forecasts for increasing stockpiles at Cushing,
the area's inventories have been in decline. Last week, storage there
reached its lowest level since mid-December.