US crude oil inventories dropped -4.4m barrels in the week ending September 11, versus expectation of 2.1m barrels rise. At 490m barrels, oil inventories are about 14% above the five year average for this time of the year. Gasoline inventories dropped -0.4m barrels. Distillate rose 3.5m barrels. Propane/propylene dropped -1.2m barrels. Commercial petroleum inventories rose 4.3m barrels.
WTI crude oil surges to as high as 39.64 so far. The break of 39.42 resistance now suggests that pull back from 43.50 has completed at 35.98 already. Further rally would likely be seen through 40 handle to retest 43.50 high. Nevertheless, We’ expect sideway consolidation to continue below 43.50 with at least one more following leg. Hence, we don’t expect a firm break of 43.50 this time.
