US EIA data showed a crude oil stocks change of -9.014M for the week of 13 February. The market expectation was 2.1M.
We saw a massive surprise draw of over 9 million barrels last week, while the market was expecting a build of 2 million. This is an aggressively bullish signal for crude oil. The market is clearly much tighter than anyone anticipated.
Market Tightness Signals
This inventory decline is supported by fundamentals, with refinery utilization rates recently climbing to 93.1%, their highest level in two months. Strong global demand is also pulling barrels, as US crude exports are holding firm near 4.3 million barrels per day. These factors show the draw wasn’t a one-off event.
For futures traders, this suggests maintaining or establishing long positions in WTI and Brent contracts. We should look for price to break through recent resistance, with $88 per barrel for WTI becoming a realistic near-term target. The path of least resistance is now clearly upwards.
In the options market, this surprise will likely keep implied volatility elevated. We should consider buying front-month call options to capture the expected upward momentum. Selling out-of-the-money put credit spreads is another strategy to take a bullish stance while benefiting from higher premiums.
We can look back to the third quarter of 2025 when a similar series of unexpected inventory draws occurred. That period was followed by a sustained 12% rally in crude prices over the subsequent six weeks. History suggests this kind of signal has strong follow-through.
Macro Demand Support
The demand picture is also being reinforced by broader economic strength, as the latest jobs report showed an unexpected gain of 225,000 jobs. This indicates underlying consumer and industrial demand for energy will likely remain robust through the first half of the year. This gives us more confidence that higher energy prices can be sustained.
