Raymond James characterized the most recent weekly supply update from the Department of Energy as bearish relative to market expectations after the data showed a notable buildup in petroleum inventories.
Inventory snapshots
- Total petroleum inventories increased by 7.4 million barrels, diverging sharply from consensus forecasts that anticipated a draw of 2.9 million barrels.
- Crude oil inventories rose by 6.9 million barrels, compared with a consensus expectation for a smaller build of 0.5 million barrels and a seasonal draw of 1.8 million barrels.
- Gasoline inventories decreased by 2.6 million barrels, versus consensus calls for a draw of 2.1 million barrels.
- Distillate inventories climbed by 3.0 million barrels, while the market had expected a draw of 1.3 million barrels.
Other operational figures
Refinery utilization rose to 92.9% from 91.4% the previous week, indicating a larger share of crude being processed. At the same time, total petroleum imports fell to 8.0 million barrels per day from 8.9 million barrels per day the week before. The Strategic Petroleum Reserve was unchanged on a week-over-week basis.
Forward pricing
The 12-month futures strip for benchmark crude shows West Texas Intermediate at $80.65 per barrel and Brent crude at $88.35 per barrel.
Takeaway
Raymond James' read of the DOE figures centers on the contrast between actual inventory moves and market expectations: total petroleum and crude inventories increased materially more than forecast, gasoline inventories fell slightly more than expected, and distillates moved in the opposite direction to consensus. Refinery throughput rose while imports fell and the Strategic Petroleum Reserve held steady. The firm summarized these data as a bearish update relative to what analysts had been anticipating.
Context and limitations
The observations above are drawn directly from the weekly DOE release and Raymond James' note on that release. The report provides specific inventory changes, refinery utilization, import levels, and the unchanged status of the Strategic Petroleum Reserve, along with the quoted 12-month futures strip prices for WTI and Brent.