Cameron Hanover – Daily Energy Hedger – August 26, 2010

Oil prices rallied on Wednesday despite another appalling DOE report. Crude oil stocks increased their year-on-year surplus from 10.6 million barrels (3.08%) to 14.5 million barrels (4.22%). Distillate stocks went from a surplus a week ago of 12.6 million barrels (7.80%) to 13.6 million barrels (8.37%); and gasoline stocks grew from last week’s year-on-year surplus of 13.5 million barrels (6.43%) to 17.5 million barrels (8.41%). At the same time, the four-week aggregate averages for demand dropped; gasoline four-week demand fell 64,000 bpd and went from 3.59% higher to 2.98% higher than a year ago. The four-week distillate average went from being 5.84% higher than a year ago to 4.92% higher.