Crude Continues Climb Following US Stock Build Data

Oil prices continued to climb higher during APAC trading today after they rose sharply on Wednesday following EIA data showing the third straight US crude inventory drawdown. WTI is up 0.6% to $83.34/bbl off the intraday high of $83.53 to be up 2.2% this month. Brent is 0.4% higher at $85.42/bbl following a high of $85.63 but is only up 0.5% in July. The softer USD boosted oil yesterday and today the index is little changed.

• EIA reported US crude inventories fell 4.87mn last week. This is the third straight weekly drawdown worth 20.47mn barrels in total and bringing the level to its lowest since February and below the 5-year seasonal average.
• The Brent prompt spread has widened, signaling that the market remains tight, according to Bloomberg. Expectations for a Fed rate cut in September are improving the demand outlook.
• China’s Customs General Administration reported that June oil import volumes fell 10.7% y/y down from May’s -8.7% y/y. Product imports fell 32.4% y/y after -3.6% but export volumes rose 19% y/y up from 9.5% driven by diesel and kerosene. .
• Later the Fed’s Goolsbee, Logan and Daly appear and the ECB announces its decision (no change expected). There are US jobless claims and July Philly Fed, and UK labour market data.