Yesterday the American Petroleum Institute reported a surprise increase in U.S. crude oil inventories with a build of 6.55 million barrels for the week ending January 18. Oil analysts had expected a small draw down in crude oil inventories of 42,000 barrels.
Today the U.S. Energy Information Administration confirmed that surprise (if the confirmation of a surprise can still be a surprise.) U.S. crude inventories saw a build of 8 million barrels for the week ended January 18. The prior week showed a draw down of 2.7 million barrels.
These surprises are important because the oil market is waiting for evidence that production cuts from OPEC and Russia are enough to rebalance global supply and demand given evidence of a slowdown in global growth.
U.S. benchmark West Texas Intermediate crude was up 1.05% today to $53.17 a barrel. International benchmark Brent was off 0.08% to $61.09 a barrel.
Increased turmoil in Venezuela is having a relatively muted effect on oil markets because the destruction of the Venezuelan oil industry by Presidents Chavez and Maduro had already removed so much Venezuelan oil from international markets.