U.S. weekly crude oil stocks rose by 13.4 million barrels in the week ending 6 February.
In the prior week, the API estimate showed a drop of 11.1 million barrels.
Bearish Inventory Shock
A 13.4 million barrel jump in inventories is a clear bearish signal for crude oil prices. It suggests supply is running ahead of demand. This is a sharp change from the recent draws. We expect near-term pressure on front-month futures.
The build matches other recent data. U.S. refinery utilization has dipped to 82.5%, a seasonal low as refineries enter maintenance ahead of the summer driving season. At the same time, domestic crude production is steady near a recent high of 13.3 million barrels per day. When refineries process less oil while output stays high, inventories tend to rise.
We saw a similar setup in winter 2025. After a refinery disruption, a large inventory build was followed by several weeks of falling prices. That pattern suggests today’s weakness may last longer than one week. We therefore see a case for positioning for lower prices over the next month.
Positioning And Risk Strategy
In the weeks ahead, we could consider buying put options on the April WTI contract, with strike prices below $72 per barrel. Another approach is to use bear call spreads to collect premium while expecting prices to stay flat or fall. These strategies are designed to benefit if oversupply pushes prices lower.
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