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“Sell The News” Or “Sell The Reality”? Crude, RBOB Fall On “Bullish” Data

Apparently it's a "sell the news" kind of day. Either that, or the reality of near-record stockpiles and soaring production has set in permanently after last week's rout.

Well, there it is: confirmation of yesterday’s API number, which showed a surprise draw in US stockpiles.

As a reminder, the unexpectedly bullish print came on the heels of a rollercoaster day that underscored what we might call “Saudi headline risk.” In a nutshell:

SaudisOPEC

That was the setup for the API numbers, which came in as follows, for those who missed it:

  • Crude inventories fell 531k bbl last week
  • Cushing +2.06m
  • Gasoline -3.88m
  • Distillates -4.07m

The crude draw came against estimates for a DOE build of 3,133K/bbl. Moments ago, the API data was confirmed as follows:

  • EIA: Crude -237k Bbl, Median Est. +3,133k Bbl
    Cushing crude +2,130k
  • PADD 3 crude -2,409k
  • Gasoline -3,055k vs est. -2,000k
    • PADD 1B gasoline -849k
  • Distillates -4,229k vs est. -1,500k
    • PADD 1 Distillates -3,097k
  • Refinery utilization -0.8 ppt vs est. +0.5 ppt
  • Refinery crude inputs -20k b/d
  • Crude imports -745k b/d
  • Crude production +21k b/d

Bullish, right?

Wrong.

Apparently it’s a “sell the news” kind of day. Either that, or the reality of near-record stockpiles and soaring production has set in permanently after last week’s rout.

Whatever the case, here’s the result:

Reality

Of course the algos will “mean revert” this immediately, so who knows how it will pan out.

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