All in all, crude oil stockpiles in the United States declined by 3.1 million barrels last week, according to the federal Energy Information Administration. The stocks sagged as industrial consumers of petroleum drew on their existing reserves more aggressively than the markets previously expected.
In fact, analysts had expected a much smaller draw in the face of yesterday’s privately compiled statistics from the American Petroleum Institute, which indicated that oil inventories increased during the same period.
Today’s numbers from the EIA told a very different story — and one with more upside for oil prices.
The United States Brent Oil ETF (NYSE:BNO), which reflects the price of London’s Brent grades of petroleum, is up 1.6% at the moment, while its counterpart United States Oil ETF (NYSE:USO), focused on West Texas Intermediate crude, is up 1.9%:
It is especially striking that it is the EIA numbers driving oil prices upward, since markets normally think of this survey as being too closely tied to U.S. interests — that is, lower energy prices — to be completely unbiased.
Still, if U.S. businesses are burning that much fuel, they are evidently keeping the lights on, and that speaks to the underlying health of the economy.
Nothing has fallen over any cliffs, yet.
Emerging Money provides insightful and timely information about the increasingly important world of Emerging Market investments. CNBC Emerging Markets Contributor Tim Seymour leads the team of Emerging Money to bring you cutting edge global news and analysis.
About Tim Seymour: Tim is a founder of Emerging Money. He is a founder and Managing Partner at Seygem Asset Management, and The Emerging Markets Contributor to CNBC. Seygem Asset Management focuses on investing throughout the global emerging markets asset class. With a view that emerging and developing economies will continue to outpace the economic growth and advancement of developed economies, Seymour has devoted a career to investing in the dominant markets of tomorrow, today. Seymour’s career has included significant experience in both alternative asset management (hedge funds) and capital markets, having launched two hedge funds, and built the largest Russian broker dealer in the USA. Seymour started his career at UBS, focusing on international credit (cash, swaps, forex) in a specialized hedge fund group (New York). Seymour completed the firm’s training program after graduating with an MBA in international finance from Fordham University. Seymour received his undergraduate degree at Georgetown University.