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Oil prices are higher this morning on the prospect of US-China trade talks (and after better than expected China macro data last night and an implicit suggestion that Beijing will do 'whatever it takes' to maintain the illusion of 5% growth). Prices shrugged off the surprise build in crude stocks reported by API last night.

Elsewhere, Iran said it won’t be drawn into negotiations with the US over its ability to enrich uranium, reducing the potential of looser restrictions on Iranian crude.

Will the official data have any more bearing on sentiment than the API build?

API

• Crude +2.40mm (-1.68mm exp)

• Cushing -349k

• Gasoline -3.0mm

• Distillates -3.2mm

DOE

• Crude +515k (-1.68mm exp)

• Cushing -654k

• Gasoline -1.96mm

• Distillates -1.85mm

Crude stocks rose for the 3rd straight week (but only adding 515k barrels – a lot less than the 2.4mm build reported by API) while Gasoline stocks fell for the 7th straight week…

Source: Bloomberg

Even with the 299k barrels addition to the SPR, this was a small crude build…

Source: Bloomberg

Total gasoline stocks are at their lowest since Dec 2024…

Source: Bloomberg

Stocks at the all important Cushing Hub fell to their lowest for this time of year since 2008…

Source: Bloomberg

US Crude production was flat on the week, holding near record highs…

Source: Bloomberg

WTI extended gains after the official report with prices topping $62…

Source: Bloomberg

Crude has recovered from a sharp drop to near the lowest in four years brought about by an onslaught of tariffs and counter-levies between the US and its biggest trading partners. Washington on Tuesday started a probe into the need for import taxes on critical minerals, while trade differences with the European Union persist as White House officials said the bulk of the US tariffs imposed on the bloc won’t be removed.

Meanwhile, Iraq plans to cut its oil exports this month as it faces growing pressure to adhere to its OPEC+ production target. The country aims to reduce shipments by 70,000 barrels a day, an official with knowledge of the matter said.