After trying to grab ahold of the fifty dollar handle, WTI has lost its grip and is sliding lower in forty dollardom once more. Even though U.S. inventories look set to descend through August, global oversupply concerns are overshadowing this supportive influence. Hark, here are some things to consider in oil markets today.
In terms of U.S. oil inventories in August, it has been a mixed bag for movement in the last five years (build / build / draw / draw / draw). While record refinery runs and rising exports are helping to draw stocks this summer, flows from Saudi Arabia and Venezuela remain very much in focus on the import side of the equation.
As Saudi Arabia cuts flows to the U.S., this supply drop is manifesting itself in lower deliveries to Port Arthur. Saudi Aramco’s Motiva refinery at Port Arthur has imported 314,000 bpd through the first seven months of the year, just a smidge below year-ago levels.
While arrivals through the first quarter were really strong – as were total Saudi Arabian deliveries to the U.S. – imports over the last four months have averaged 157,000 bpd, considerably lower than the 216,000 bpd seen over the same period last year. Saudi barrels account for