Oil: Private survey of inventory shows a headline crude oil build less than expected

Key Results from the Oil Inventory Survey

Recent findings from a private oil inventory survey indicate that the overall crude oil build was less than anticipated. Specifically, expectations centered on a headline crude build of +2.39 million barrels, distillates at +1.75 million barrels, and gasoline at +1.55 million barrels. This survey was conducted by the American Petroleum Institute (API) and differs from the official data reported by the U.S. Energy Information Administration (EIA).

Differences Between API and EIA Reports

The API report is based on data from oil storage facilities and companies, while the EIA's report relies on government data, which is generally considered more accurate and comprehensive. The EIA report also includes significant indicators about the status of the oil market, including inputs and outputs from refineries.

Rising Geopolitical Risks

Additionally, tensions between Saudi Arabia and the UAE have resurfaced, raising further concerns for energy markets. Saudi Arabia has reported strikes against UAE-backed factions, highlighting an escalation in political significance. As both countries are crucial to global oil supply chains, any increase in tensions could inflate geopolitical risk premiums. The pending EIA report will be crucial to watch given these developments in the oil market.