WTI, RBOB, and Henry Hub stayed capped: hefty U.S. product builds, high refinery runs, soft demand, and resilient supply outweighed crude draws; LNG exports and firmer prices offered limited support.
Crude Oil
Volatile WTI followed by the biggest pile up in 2 Years
- Back-to-back EIA prints whipsawed sentiment: Crude drew first, then a +3.4 mb build, while gasoline +7.7 mb, then +9.0 mb, and runs ~95% kept WTI rallies capped.
- China demand optics supportive, not explosive: Record-high December crude imports and robust 2025 refinery throughput/stock-building buoyed risk appetite, but didn’t outweigh U.S. product builds.
- Black Sea turbulence added a fleeting risk premium: CPC terminal disruptions and reported drone strikes on tankers highlighted export fragility around Novorossiisk.
- Macro balances still heavy: OPEC’s January take left 2026 demand growth ~1.4 mb/d; EIA’s STEO projects rising global inventories and softer 2026 prices.
- End-use signals mixed: Four-week products supplied ran ~2% below y/y in the earlier report and ~1% below in the later report—enough to pressure cracks and fade headline spikes.
Gasoline
Gasoline prices remain below $1.8 mark, despite storage normalizing
- Big U.S. build capped rallies: Gasoline inventories jumped +9.0 mb (now ~4% above 5-yr), with blending components rising—front-month strength faded.
- Demand underwhelmed into mid-Jan: Four-week gasoline supplied hovered near 8.5 mb/d (“similar” y/y) as refineries ran ~94.8% and output held ~9.3 mb/d.
- Builds were regional, not isolated: East Coast +2.9 mb and Midwest +3.5 mb led stock gains, reinforcing a comfortable near-term balance.
- Atlantic pull softened: Mid-January reports showed gasoline cracks easing, dulling trans-Atlantic arbitrage support for U.S. barrels.
- Logistics risk premium eased: Major carriers began resuming Suez/Red Sea transits, trimming freight and supply-chain frictions that had supported prices.
Natural Gas
Natural Gas plummeted to 3-month low as storage buildup doubled y/y
- Storage draw underwhelmed: Stocks stayed comfortable (~3% above 5-yr), keeping front-month rallies in check. EIA reported a 71 Bcf withdrawal to 3,185 Bcf, well below typical mid-winter pulls.
- Exports firm but not fiery: 33 U.S. LNG cargoes and steady feedgas helped; overseas prices only modestly supported. EIA showed 33 departures as East Asia averaged ~$9.6/MMBtu and TTF ~$10.2/MMBtu.
- Supply resilience lingered: Rigs steadied and 2026 output seen rising, a structural headwind for Henry Hub. Gas rigs were ~124; STEO projects U.S. dry gas near ~109 Bcf/d in 2026.
- Weather/demand skewed soft: Below-normal HDDs nationally muted heating load despite brief Northeast cash spikes. EIA temperature tables and spot prints showed widespread warmth with localized volatility.
- Global cues firmer, not explosive: TTF jumped on a cold snap, and Asia spot ticked up, offering only a modest Atlantic pull. Reuters/WSJ reported firmer TTF and higher Asia spot into mid-month.