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Oil prices slipped lower this morning after treading water for most of the night after the API report.

Disappointing data on European economic activity helped weigh on oil prices Tuesday, as did the release of more Hamas hostages and the delay of the expected Israeli ground invasion of Gaza.

Brent crude prices have remained stubbornly within the $90 per barrel range, emphasizing the medium-term outlook’s dependence on demand rather than supply.

API

• Crude -2.688mm (+10k exp)

• Cushing +513k

• Gasoline -4.169mm (-300k exp) – biggest draw since March

• Distillates -2.313mm (-1.1mm exp)

DOE

• Crude +1.37mm (+10k exp)

• Cushing +213k

• Gasoline +156k (-300k exp)

• Distillates -1.69mm (-1.1mm exp)

The official data was very different to API's with crude and gasoline both seeing inventory builds (as well as Cushing stockpiles rising off tank bottoms)…

Source: Bloomberg

The SPR remained untouched for the 3rd week in a row (what about refilling it?)

Source: Bloomberg

Cushing stockpiles remain barely off tank bottoms…

Source: Bloomberg

US Crude production remained at record highs as the trend in rig counts continues lower…

Source: Bloomberg

WTI was trading around $83.30 ahead of the official data and tumbled to an $82 handle after….

For context, most of the war premium has now left the building…

As Bloomberg Intelligence Senior Oil & Gas Analyst Fernando Valle notes, the rally in Brent and WTI prices is hitting a wall of concerns over demand, with China’s real estate crisis and rising tensions in the Middle East adding to the geopolitical premium.

We see reasons to be cautious as US trucking demand weakens and consumers default on car payments at record levels.