Oil: Private survey of inventory shows a headline crude oil build vs. draw expected

The oil market is showing notable movements as the year-end approaches. A recent private survey by the American Petroleum Institute (API) indicated a substantial increase in crude oil stocks, contrasting with expectations for a decrease. The anticipated figures were -2.4 million barrels for crude, +0.4 million for distillates, and +1.1 million for gasoline, but the actual data shows a larger build in oil inventories. The official EIA report is expected to be released on Wednesday morning, and it holds greater accuracy and comprehensiveness, making it crucial for understanding market dynamics. Geopolitical risks have resurfaced, contributing to rising oil prices. Notably, the U.S. intercepted a Venezuelan oil tanker, amplifying concerns over potential supply disruptions and rebuilding a modest risk premium in crude markets. Tensions in the Middle East continue, with the Israel-Iran standoff leading market participants to adopt a cautious stance. These factors have combined to stabilize prices and initiate a recovery from recent declines. However, the increasing inventory levels could still pose risks to this upward momentum.