US Weekly: EIA Stock Draw Larger Than Expected

the EIA data showed larger than expected stock draw, with crude stocks down 2.136m bbl compared to an expected fall of 718k bbl.

• EIA Weekly US Petroleum Summary - w/w change week ending Sep 15: Gasoline stocks -831 vs Exp +667, Implied mogas demand +103, Distillate stocks -2,867 vs Exp +177, Implied dist demand +588
• Baker Hughes Reported that US rig count fell by 11 on the week to 630 rigs, the first fall in three weeks. The US oil rig count fell by 8 to 507 rigs, while the gas rig count was down 3 to 118 rigs. The U.S. Offshore Rig Count was unchanged from Last Week at 19.
• The US Strategic Petroleum Reserve received an inflow of oil for the seventh straight week of 600k barrels of sour crude according to data from the Department of Energy.
• Russia’s ban on diesel and gasoline exports could last slightly over one month and may offer and upside for US refiners, according to TD Cowen’s equity research group.
• US imports of European gasoline fell to a five-month low last week according to Bloomberg vessel tracking. Gasoline imports sunk to 88k b/d, the lowest since the week ended April 6 and down from 243k b/d the week prior.
• Oil output in the major US shale oil basins is forecast to fall by 40kbpd to 9.393mbpd in October according to the EIA drilling productivity report released yesterday.
• Canada’s Trans-Mountain pipeline (TMX) expansion will almost triple the flow of crude to Canada’s Pacific coast from 2024, diverting crude from refiners in the US mid-west and Gulf Coast, according to Reuters.
• US crude imports are at an 11-month high according to Kpler as they arrived at 3.5mn bpd for the week beginning 11 September.
• The Federal Reserve left interest rates steady at 22-year highs Wednesday but kept the door open to one more increase in borrowing costs this year, while reducing the number of rate cuts officials see in 2024. After leaving the federal funds rate in a 5.25%-5.5% range FOMC members penciled in another quarter-point rise this year in their quarterly Summary of Economic Projections.
• Alongside a hawkish hold from the Fed, the USD index traded within ten pips of the 2023 highs, printed earlier in March at 105.88. A 0.25% increase for the index this week extends the streak of consecutive weekly advances to ten.
• Fed: Daly Non-housing services inflation remains sticky. Some of it is cyclical. We’ve got to watch strong medical inflation, it’s not interest rate sensitive but legislation and policy sensitive.
• Congress departed Washington Sep. 21 with the House of Representatives at gridlock. House Speaker Kevin McCarthy's (R-CA) plan to advance a Pentagon spending bill was torpedoed by House conservatives who appear set on pushing the government towards a shutdown.