US Crude Oil Inventories Dropped 7 Million Bbls -- Records Set -- January 18, 2018

Gasoline demand is at this site; at the link, scroll to the bottom of the page. Gasoline demand continues to fall (as expected this time of the year) but remains ahead of the same period last year.

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Five years ago, or thereabouts, "we" were building LNG import terminals; now we are exporting natural gas. This is the story that is not being told: our energy balance of payments would be setting new records buying natural gas from the Mideast. Our "energy balance of trade" is allowing the Federal government to spend money elsewhere, much on social services. Those folks complaining about frackers and fracking should be sending the oil industry "thank you" letters -- like that will ever happen. LOL. And those frackers did that fighting regulations, politicos, and protestors all along the way. They're still fighting natural gas pipelines in New England. We'll never know who "lucky" we were. We certainly won't read about this story in the mainstream media.

Before we get to the US crude oil inventories, let's look at the US natural gas draw, from John Kemp via Twitter. The current stocks are almost at historical lows -- not quite there but ....

Chart as depicted by EIA:

Now, back to the US crude oil inventories.

I'm being told that the 7-million-bbl draw is:

• a record;
• the most ever drawn from Cushing: and, 
• the largest drawdown ever. I guess I'm repeating myself.

ZeroHedge has the data - it's a great read with great graphics.

The market's reaction: ho-hum. WTI at $63.94, down 3 cents. Yes, after the report, WTI declined slightly. The phrase that CNBC will use: the price of WTI has already baked in the weekly drawdown. 

The weekly petroleum report is here. The data points:

• US commercial crude oil inventories decreased by 6.9 million bbls; now at 412.7 million bbls, still in the middle of the average range for this time of the year
• refineries operated at 93% of their operable capacity last week
• total gasoline inventories increased by 3.6 million bbls
• distillate fuel inventories decreased by 3.9 million bbls (think heating oil in the northeast)
• jet fuel product supplied is up 8.7%

Re-balancing is now down to 20 weeks, around mid-2018:

Week	Date	Drawdown	Storage	Weeks to RB
Week 0	Apr 26, 2017		529.0	180
Week 1	May 3, 2017	0.9	528.0	198
Week 2	May 10, 2017	6	522.0	50
Week 3	May 17, 2017	1.8	520.2	59
Week 4	May 24, 2017	4.4	515.8	51
Week 5	May 31, 2017	6.4	509.9	41
Week 6	June 7, 2017	-3.3	513.2	60
Week 7	June 14, 2017	1.7	511.5	57
Week 8	June 21, 2017	2.5	509.0	62
Week 9	June 28, 2017	-0.2	509.2	71
Week 10	July 6, 2017	6.3	502.9	58
Week 11	July 12, 2017	7.6	495.3	47
Week 12	July 19, 2017	4.7	490.6	43
Week 13	July 26, 2017	7.2	483.4	38
Week 14	August 2, 2017	1.5	481.9	42
Week 15	August 9, 2017	6.5	475.4	35
Week 16	August 16, 2017	8.9	466.5	30
Week 17	August 23, 2017	3.3	463.2	29
Week 18	August 30, 2017	5.4	457.8	27
Week 19	September 7, 2017	-4.6	462.4	32
Week 20	September 13, 2017	-5.9	468.2	39
Week 21	September 20, 2017	-4.6	472.8	46
Week 22	September 27, 2017	1.8	471.0	46
Week 23	October 4, 2017	6.0	465.0	41
Week 24	October 12, 2017	2.8	462.2	40
Week 25	October 18, 2017	5.7	456.5	37
Week 26	October 25, 2017	-0.9	457.3	39
Week 27	November 1, 2017	2.4	454.9	38
Week 28	November 8, 2017	-2.2	457.1	42
Week 29	November 15, 2017	1.9	459.0	43
Week 30	November 22, 2017	1.9	457.1	42
Week 31	November 29, 2017	3.4	453.7	41
Week 32	December 6, 2017	5.6	448.1	37
Week 33	December 13, 2017	5.1	443.0	36
Week 34	December 20, 2017	6.5	436.5	30
Week 35	December 28, 2017	4.6	431.9	28
Week 36	January 4, 2018	7.4	424.5	25
Week 37	January 10, 2018	4.9	419.5	23
Week 38	January 18, 2018	6.9	412.7	20

We haven't talked about this in a long time: weekly US days of crude oil. Right now it's about 24 days; I put the over/under line at 20 days. If we drop below 20 days, it will be something we haven't really seen since before the Saudi surge, back in 2014. If we stay at / above 24 days, one would think the price of crude oil would not trend higher.