Oil focuses on macroeconomics, fundamentals close second

Global equities were about unchanged over the last 24 hours with the U.S. and western markets falling yesterday but offset by the rebound in Asia overnight. The EMI Global Equity Index is still showing a small 0.3% gain for the week with the year to date gain currently at 7.1%. Not much changed in the ranking other than China's year to date loss has narrowed modestly to 7.6%. Global equities have been a neutral for oil prices and the broader commodity complex over the last twenty four hours.

On the fundamental front the first batch of data released last night... the API inventory report was mixed (see below for more details). US inventories are still well above both last year and the five year average or simply put oil is well supplied globally with no shortage of oil any place in the world. Oil fundamentals are still biased to the bearish side.

The API report was mixed and not in directional sync with the range of expectations. Crude oil showed a larger than expected draw. Gasoline showed a much larger than expected build in inventory while distillate fuel also built versus an expectation for a modest draw. The API reported a draw (of about 2.2 million barrels) in crude oil stocks versus an industry expectation for a smaller draw as crude oil imports increased while refinery run rates increased strongly by 2.1%. The API reported a modest build in distillate and  large increase in gasoline stocks.

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