NEW YORK, Oct 1 (Reuters) - U.S. crude oil inventories rose
sharply last week while gasoline stocks showed an unexpected
build, according to data from the U.S. Energy Information
Administration released on Wednesday.
Distillate stocks fell more than expected in the week to
Sept. 26.
HIGHLIGHTS FROM EIA REPORT (In million barrels):
- Crude +4.3 (forecast +2.4)
- Distillate -2.3 (forecast -1.2)
- Gasoline +0.9 (forecast -1.6)
Click here for the EIA status report []
Click here for the API status report []
ANALYST COMMENTS
ROB KURZATKOWSKI, ANALYST, OPTIONSXPRESS, CHICAGO:
"The report was one crude bulls didn't want after the
economic uncertainty, with the much larger build in crude than
expected and the surprise build in gasoline.
"The big surprise was the big draw down in distillates, but
these reports will stay a little out of line until the Gulf
Coast gets back to normal in a few weeks.
"It's somewhat encouraging to consumers. Gasoline prices
are dropping other than in the Southeast, so consumption should
rise on the lower prices. You may see wholesale prices drift
toward the $2 mark.
"We're seeing a lot more uncertainty about whether a
bailout plan will save the banking system at this point. This
(oil inventory) report will probably, at least in the short
term, add to the downward pressure on crude and gasoline."
TOM BENTZ, ANALYST, BNP PARIBAS COMMODITY FUTURES, NEW
YORK:
"The EIA numbers were mostly in line with expectations,
except that the EIA showed a build in gasoline, but the API
showed a draw. Gasoline demand continues to plummet."
JIM RITTERBUSCH, PRESIDENT, RITTERBUSCH & ASSOCIATES,
GALENA, ILLINOIS
"The numbers are receiving a bearish reception with
particular attention placed on the unexpected gasoline stock
build of almost 1 million barrels. However, most other parts of
the data appeared bearish with crude imports rebounding by a
huge 1.85 million barrels per day.
"The only supportive figure was the 2.3 million barrel drop
in distillate stocks, but this bullish item should be easily
overshadowed by the other data. All in all, a drop to below $95
in November crude could be seen today until financials come to
the rescue."
STEPHEN SCHORK, EDITOR, THE SCHORK REPORT, PHILADELPHIA,
PA.
"We are seeing the proper response on the NYMEX. I think
what we are starting to see is the obvious pullback in demand
for crude oil. You would expect to see crude oil supplies
building at this point.
The fact that we got a build in gasoline I think is really
kind of throwing the market off tilt. I wasn't, and I don't
think a lot of people were, expecting a build in gasoline."
CHRIS JARVIS, SENIOR ANALYST, CAPROCK RISK MANAGEMENT, NEW
HAMPSHIRE:
"Strong imports and sluggish demand resulting from cash
price spikes and an ailing economy more than offset the
shut-ins resulting from hurricanes Gustav and Ike."
"Overall the only bullish component of today's data was the
distillates number, which showed a bigger-than-expected drop.
The spike in imports should keep the bears somewhat in check as
inventory levels in gasoline remain at historic lows."
"On a macro front, all eyes will remain on the $700 billion
package going to vote in the Senate tonight and possibly back
in the House the second half of the week. Failure to pass would
put pressure across the board, while passing of the package
would likely create a relief rally."
TIM EVANS, ENERGY ANALYST, CITI FUTURES PERSPECTIVE, NEW
YORK:
"The overall tenor of the EIA report was bearish relative
to expectations, with a larger-than-expected 4.3 million
barrels build in crude stocks on a big 1.8 million barrels per
day jump in imports.
The build in gasoline stocks was also a surprise, with
production reported up 736,000 bpd from the prior week versus
demand that was 11,000 bpd lower. The distillates draw was
larger than expected, but not a full offset to the other
data."
MARK WAGGONER, PRESIDENT, EXCEL FUTURES, HUNTINGTON BEACH,
CALIFORNIA:
"The EIA numbers are not too far from what the market
forecast and so people will still be looking at developments in
Congress about the financial rescue package.
The market is on a wait-and-see attitude in this regard and
we might see crude prices fall towards $90, if not today,
tomorrow perhaps. I still see the financial bailout passing
Congress, but the House of Representatives' approving it is the
tough part. The markets are still keyed on all that's happening
in Washington."
AMANDA KURZENDOERFER, COMMODITIES ANALYST, SUMMIT ENERGY,
LOUISVILLE, KENTUCKY
"Crude and gasoline inventories built, so that was bearish
for the market overall. Distillates fell -- distillate
inventories usually begin to decline at this time of year.
"Distillate inventories are at the bottom of the five-year
range, but they usually begin to drop (around this time of
year), so it is not as concerning as it might have been a few
weeks ago. Demand is pretty weak, I think that is what is
keeping it from being supportive."
MARK KELLSTROM, ANALYST, STRATEGIC ENERGY RESEARCH, SUMMIT,
NJ
"The numbers look bearish.
Recent EIA data about U.S. demand has also been negative.
This probably continues to weigh on crude prices. But we would
say that inventories are still relatively low compared to
five-year averages. Gasoline stocks are near 40-year lows.
On crude prices, we're gonna find out ... whether demand
fears can be overcome by federal fiscal bailouts and central
bank inflation."
(New York Energy Desk, 646-223-6050)
