Conflicting signals in oil markets, including a huge addition to U.S. crude inventories

Cold weather at refineries keeps weighing on supply in the U.S., says Robert Yawger, energy futures strategist at Mizuho Americas.

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COULD BE CAUSING CRUDE CONSUMPTION AND SUPPLIES IN CUSHING, OKLAHOMA OUT RISING. IT WAS THE BIGGEST JUMP ACTUALLY SINCE LATE LAST YEAR. WE’RE JOINED BY BOB YAWGER ENERGY FUTURE STRATEGIST AT MIZUHO AS AMERICA’S ALWAYS GREAT TO SEE A BOB, THANKS

VERY MUCH FOR COMING ON THE SHOW. I I KNOW THIS IS JUST ONE WEEK. WOULD YOU READ MUCH INTO THAT BIG BUILD IN CRUDE STOCKPILES? YES, I WOULD, ANDREW. THEY’RE RUNNING REFINERY AT SUCH LOW LEVELS. >> AND THERE WAS DOWN THE RATE

AT WHICH OUR REFINERIES, UNITED STATES WAS DOWN FOR THE 6TH WEE IN A ROW THAT HAS JUST LESS AND LESS CRUDE THAT GOES FIRING AT THE END OF THE DAY, THEY DON’T USE CRUDE OIL FOR 2 TANKS, BASICALLY TO MAKE GASOLINE AND TO MAKE HEATING

OIL SLASH DIESEL. IF YOU REFINERY DOWN. SO LOVE THAT YOU NOT MAKING A LOT OF EITHER ONE OF THOSE THAT THEY’RE NOT SENDING A LOT OF CRUDE TO A REFINERY THAT CLEARLY THEY’RE NOT USING GOES TO STORAGE AND LETS YOU EXPORT A LOT OF

BARRELS. THOSE BARRELS ARE GOING TO PILE UP IN STORAGE AND THAT’S WHAT’S HAPPENING RIGHT NOW. WHY ALL THE REFINERIES RUNNING AT SUCH A LOW RAISES IT JUST MAINTENANCE. >> AND THEY WERE FORECASTING OR A HIGH MADE ITS SCHEDULE

THIS YEAR ALREADY. THAT WE HAD TO FREEZE AND 3, 4 WEEKS AGO AND THE RIGHT RATE NEVER CAME BACK. THEY HAD TO SHUT THE 2.70 BIG REFINERIES DOWN BECAUSE TEMPERATURES. TEMPERATURES SO BELOW THE LEVEL THAT THEY’RE ALL PART OF THEIR OPERATIONAL CAPACITY OF

LOUISIANA TAXES, BUT THEY THAT POINT DECIDED LESSON. WE’RE NOT REALLY GETTING A BIG DOLLAR HERE FOR OUR PRODUCT. THAT’S COMING OUT OF LET’S NOT BRING THIS REFINERY BACK SO FAST. LET’S EXTEND OUR MAINTENANCE SEASON. AND THE PRICE OF THE PRODUCT HAS RISEN

ACCORDINGLY. SO I, THEY’VE DONE THE RIGHT BUT IT PUTS PRESSURE ON CRUDE OIL. THE PRODUCTS ARE DOING PRETTY GOOD. CRUDE OIL IS ACTUALLY DOING PRETTY GOOD RIGHT NOW BECAUSE OF GEOPOLITICAL TENSIONS. BUT IF YOU PULL THE RUG OUT FROM UNDER THOSE

GEOPOLITICAL TENSIONS, THERE HAS DEFINITELY THE POTENTIAL FOR APPROVAL OF THE SLIDE, RATHER NOT SAY WHY IS THAT YOU JUST FEEL THAT THE GLOBAL MARKET LOOKS WELL SUPPLIED. GLOBAL MARKETS. WELL-SUPPLIED DEMAND IS NOT REVEREND, THE CHINA MARKET IS NOT REALLY

THERE ANYMORE FOR THE VICTIM. THEN PEACE AND WE HAVE A PRETTY LIGHT CRUDE OIL IN STORAGE. SO YOU KNOW, IF YOU PILE THE MORE ON TOP OF IT, IT’S JUST GOING CONTINUE TO SLIDE LOWER RATE. NOW THE THREAT OF TAKING BOWS OFF IN

THE MIDDLE EAST B OF THE IRANIAN BARRELS OR SAUDI BARRELS BECAUSE OF THE WORK. GAZA HAS PUT A CERTAIN DEAD IN THE MARKET. DESPITE THAT 2 POLITICAL BIT. WE ARE STILL ONLY TRADING IN THE 70’S FOR WTI. ON THE OTHER HAND YOU

KNOW, COUPLE DOLLARS ABOUT 84 INTERNATIONAL BENCHMARK. BRENT. WHAT ABOUT NATURAL GAS JUST LOOKING WTI OIL NOW DOWN 3% IN THE PAST YEAR, ACQUIRED BY GAS GAS. NOW TRADING IN AMERICA, CLOSE TO 3 AND A HALF YEAR LOWS. BOB. >> YEAH, IT’S A BAD SITUATION

AND NATURAL GAS. WE’RE STARTING TO GET PRETTY CLOSE. THE EXTRACTION RATE, THE PRICE RIPA PRODUCER PACE TO GET THE GAS OUT OF THE GROUND. THAT’S HOW BAD IT’S GETTING. SO WE’VE BEEN DOWN FOR WHAT, 8 DAYS AROUND 7 DAYS IN A ROW AND

WE’RE NOT DOWN BY SMALL THAT IT FALLS BY PERCENTAGE POINTS EVERY DAY. THERE’S END OF THE DAY. THE PROBLEM IS THIS, THERE’S A LOT OF NATURAL GAS AND STORE IT. UNITED STATES, WE HAVE A BIG STORES NUMBER COMING DOWN THE PLANT AGAIN

TOMORROW, IT’S GOING TO ADD MORE GAS TO STORES TOMORROW, MORE LIKELY THAN NOT AND PUT MORE PRESSURE ON PRICE. SO IT WORK AND TO REALLY BEING DOWN LEVELS HERE AND IT’S GOING TO HAPPEN AGAIN TOMORROW. IT’S A BLEW THROUGH $2. ALSO ANDREW,

THIS THAT POSITION SWITCH FROM THAT LOGGED IN THAT SHORT. NOT SURE. ACTUALLY, I’M SURE IT’S GOING TO BE THE CASE IN THIS WEEK’S CFTC REPORT THAT DOESN’T HELP MATTERS. SOME OF THE SPECULATE SPECULATOR IS SURE AND THEY’RE PROFITING WITH MARKET RATES LOWER.

THEY’RE PUSHING IN THE FACE OF REALLY NEGATIVE FUNDAMENTALS. SO