Oil focuses on Fed meeting as inventories take backseat

Global equities have continued in recovery mode so far this week after declining for the two previous weeks in a row. The EMI Global Equity Index has gained about 1.3% for the week so far with the year to date loss narrowing to 4.7%. There are still four of the ten bourses in negative territory with Brazil on the bottom and Japan still showing the largest gain for the year. Global equities have been a positive price driver for the oil complex this week.

Wednesday's API report was mixed with a bias to the bullish side after a larger than expected draw in crude oil stocks and distillate fuel. Gasoline stocks built a tad more that the expectations. Total crude oil stocks decreased by 4.3 million barrels after a 9 million barrel draw the previous as crude oil imports decreased strongly while refinery run rates increased by 1.5%. The API reported a surprise draw in distillate fuel inventories and a larger than expected build in gasoline stocks.

The entire oil complex is firm as of this writing and heading into the EIA oil inventory report to be released at 10:30 AM EST today. The market is usually cautious on trading on the API report and prefers to wait for the more widely watched EIA report due out this morning. On the week gasoline stocks increased by about 0.9 million barrels while distillate fuel stocks decreased by about 0.6 million barrels.  

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