Thursday, April 9, 2009

Crude at Levels Not Seen in 16+ Years + Tiny Distillate Drop = "Shocked" Traders

Reuters reports:

U.S. crude oil futures reversed course and rose sharply Wednesday after government inventory data showed that, despite crude inventories rising to their highest level in nearly 16 years, distillate stocks fell much more than had been forecast for last week, stunning traders.

"The big distillate draw is a big surprise and shocked everybody and that has a lot to do with crude turning to the upside here," said Mark Waggoner, president of Excel Futures in Huntington Beach, California. Domestic crude stocks rose for the fifth straight time last week, by 1.7 million barrels to 361.1 million barrels --- the highest level since the week to July 16, 1993, when stocks hit 362.2 million barrels, EIA data showed.

I'll agree crude rose (and rose to levels seen not 16 years, but closer to 19 years ago)....

But the shock about the "big" draw? While I'm no expert, in the grand scheme of things, this doesn't appear all that "big".

Source: EIA