A Texas tax law could muddy U.S. oil inventory data through year-end, but the crude glut is not going away and is now showing up in an oversupply of diesel and other fuels.
That's what showed Wednesday, with a surprise drawdown in U.S. crude stockpiles of 3.6 million barrels, the first decline in 11 weeks. Analysts had expected an increase, and it would be bullish for prices if inventories continue to go down.
But there was also a surprise 5 million barrel rise in distillates, which are diesel and heating oil. That weighed on the market, which had initially rallied on the drawdown in crude.