Crude oil trades softer but well above key support ahead of the holiday delayed inventory report from the Energy Information Administration at 1500 GMT. Last night the American Petroleum Institute reported a 10.5 million barrel rise in crude oil stocks. Significantly higher than the 2.5 to 3 million barrels surveys are looking for from the EIA.
While a draw would be in line with the seasonal behavior for U.S. stocks a figure close to 10 million barrels would be the biggest increase since February and it would put the last five weeks increase close to 20 million barrels. A combination of a continued slowdown in refinery demand and lower exports due to the recent surge in tanker rates could be the explanation behind a bigger-than-expected inventory rise.
Gasoline and distillate stocks are both expected to continue their seasonally decline. The latter could hit a five-year seasonal low should the report confirm the 2.5 million barrel drop.