EIA reported a 9.3 million bbl crude draw in yesterday's weekly oil storage report. This crude draw was within our range, and our very strong US crude exports were the reason for the outperformance.
But do not be fooled by this supposedly bullish number. US commercial crude storage has officially bottomed for this year and will meaningfully build into year-end.
With implied US crude oil production averaging near ~14 million b/d today, US commercial crude storage will finish the year well above the previous year's levels.
Based on our sensitivity analysis, US commercial crude storage is expected to finish the year near 450 to 460 million barrels. This will push it to the highest level (for that time of the year) over the last 5 years.