WTI/RBOB flatlined after last night's bigger-than-expected crude build from API, but both has slipped lower since Europe opened ahead of the DOE data. Prices extended their losses after DOE confirmed a much bigger-than-expected crude build (+6.22mm vs +1.23mm exp) and surprise gasoline build.

API

• Crude +3.427mm (+1.23mm exp)

• Cushing +725k

• Gasoline +1.602mm

• Distillates -4.083mm

DOE

• Crude +6.218mm (+1.23mm exp)

• Cushing +416k

• Gasoline +1.171mm (-500k exp)

• Distillates -3.9mm (-1.5mm exp)

Biggest build in crude since January and a surprise build in gasoline confirmed API's data...

Bloomberg Intelligence's Energy Analyst Fernando Valle noted that wide crude price differentials are likely to be pushing refinery utilization higher in the Mid-Continent and Gulf Coast regions, slowing the pace of product-inventory draws.

As usual, production is a key focus. Bloomberg Intelligence's Senior Energy Analyst Vince Piazza explains that growing strength in Brent prices combined with elevated U.S. crude output is widening the discount for WTI vs. seaborne blends and encouraging domestic production. And sure enough US crude production rose 33k b/d to a new record high...

WTI/RBOB prices did not react to API data overnight but started to fall again as Europe opened overnight, and extended losses after DOE data confirmed the surprise API builds...

However, “the geopolitical-risk forces are strong,” said Bjarne Schieldrop, chief commodities analyst at SEB AB in Oslo. “For the time being, the risk for the oil price is on the upside.”