With her pronouncement that the Fed could actually lower interest rates and uncertainty about banking stocks earning misses and oil company bankruptcies fear is in the market. The Riksbank in Sweden cut its main repo rate by 15 basis points to -0.5%. The bank said it felt forced to act because of “weakening confidence” in achieving its inflation target of 2%.
We are continuing to see a run to the gold market as it hit the highest level in a year and the treasuries yield curve is at the flattest level since November 2011, showing signs that things may start to boil over.
Oil price seems have been the canary in the coal mine, but now financial markets are pricing in fear. Global markets are hitting sees levels. The Japanese yen is soaring even as Japan has gone to negative interest rates raising talk that Japan may intervene in the currency market foot the first time since 2011.
What this is saying is that the stock market is getting ready to meltdown—unless we can get confidence anywhere. At least oil is holding the low for the year. If we break that, get ready for a test of $25. The EIA report gave us a pop as crude supply fell and production fell, but with a global meltdown will it matter? Here comes Janet Yellen! Can she save the day?
U.S. crude oil imports averaged over 7.1 million barrels per day last week, down by 1.1 million barrels per day from the previous week. Over the last four weeks, crude oil imports averaged 7.7 million barrels per day, which is 5.0% above the same four-week period last year. Total motor gasoline imports (including both finished gasoline and gasoline blending components) last week averaged 683,000 barrels per day.
Distillate fuel imports averaged 201,000 barrels per day last week. U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) decreased by 0.8 million barrels from the previous week. At 502.0 million barrels, U.S. crude oil inventories remain near levels not seen for this time of year in at least the last 80 years. Total motor gasoline inventories increased by 1.3 million barrels last week, and are well above the upper limit of the average range. Finished gasoline inventories remained unchanged, while blending components inventories increased last week.
Distillate fuel inventories increased by 1.3 million barrels last week and are near the upper limit of the average range for this time of year. Propane/propylene inventories fell 3.3 million barrels last week, but are well above the upper limit of the average range. Total commercial petroleum inventories increased by 0.3 million barrels last week.
Total products supplied over the last four-week period averaged over 19.8 million barrels per day, up by 0.3% from the same period last year. Over the last four weeks, motor gasoline product supplied averaged 8.9 million barrels per day, up by 2.6% from the same period last year. Distillate fuel product supplied averaged 3.6 million barrels per day over the last four weeks, down by 15.8% from the same period last year. Jet fuel product supplied is up 6.8% compared to the same four-week period last year.