This week’s EIA data showed a huge draw from ethanol stocks, the largest draw since the start of August this year. Ethanol production fell slightly to 944Mbbl/d. Gasoline production rose by 124Mbbl/d, with a draw from stocks of 1,137Mbbl indicating a slight strength in gasoline demand.
With this huge draw from ethanol stocks, implied ethanol demand is well above the 10% blending wall, indicating that ethanol exports have been on the rise in the past week. US ethanol prices have been sitting considerably lower than Brazilian prices, leaving it the cheapest barrel globally and making it more appealing to the foreign markets.
Crude oil prices saw two month lows on Monday, as storage sites appeared to be close to reaching maximum capacity. The build on crude inventory this week sat just below Bloomberg survey expectations and leaves stock levels sitting at 479,963Mbbl, 10,949Mbbl below one year max levels. Crude production rose by 16Mbbl/d, with a build on stocks of 3,376Mbbl.