US oil inventories fell for a fifth consecutive week - BBH

Analysts at BBH point out that the American Petroleum Institute estimated that US oil inventories fell for a fifth consecutive week, and the 5.8 mln barrel draw down was the most this year.  

Key Quotes

“Gasoline inventories rose (3.17 mln barrels) in line with the seasonal build, while distillates stocks fell 1.17 mln barrels.   June light sweet crude oil stabilized and is holding above $46 a barrel.  Recall that a month ago, the WTI futures contract was near $54 a barrel and plunged to $44 at the start of this week.  The bounce is muted and oil needs to rise above $48 to be of technical significance.”

“The EIA is expected to show oil inventories fell 2.1 mln barrels.  Since the beginning of March, the EIA's estimates of US oil stockpiles have alternated between builds and draw downs.  The anticipated draw down would keep the pattern intact.  On the supply side, the EIA estimates US output this year and next are higher from forecasts made last month.  Meanwhile, as the May 25 OPEC meeting approaches, there is talk about extending the output cuts not just until the end of the year but into next year as well.”