It has been a volatile week for oil futures with prices falling on Monday and Tuesday largely due to weak economic data from China. Prices then climbed on Wednesday after the weekly stocks report showed an unexpected decline in US crude inventories. New York futures closed Wednesday at $100.77 and London at $108.13.  The stocks report showed crude inventories down by 1.8 million barrels, largely due to a drop in imports along the Gulf coast where nearly the entire drop took place. Stocks at Cushing, Okla. fell by 1.4 million barrels to 24 million last week. Analysts note that Cushing requires about 20 million barrels to remain in its storage tanks in order to function smoothly.
The question of US crude oil quality is starting to get more attention.  The surge in production from fracking tight oil fields is mainly of the light, sweet variety of crude.  Much of the refinery capacity along the Gulf Coast, however, was designed to run on heavy, sour oil that has been imported. Imports of light sweet oil into the US have nearly dried up as those refineries that can use it efficiently have switched to domestic production. Thus, the US is developing a surplus of light, sweet crude without the refinery capacity to use it efficiently. If US imports which are now largely heavy sour crudes fall much more, US refineries will have to start using lighter crudes which is a waste of expensive heavy crude refining capacity. Some analysts are saying that US imports of heavy crudes cannot fall much more. Effective utilization of the different grades of crude is the principal argument for large US crude imports and large exports at the same time.
The recent series of train fires from derailments and the debate over crude exports has led the EIA to seek permission to collect information on the API gravity and sulfur content of the various crudes being produced in the US. This information, which would not start being published until the end of 2015, would be important to the debate over lifting the export ban and understanding the dangers of shipping lighter crudes by rail.
US natural gas futures have also been volatile this week as the markets grapple with the issue of whether there will be enough excess production this summer to refill the depleted US natural gas storage caverns.  This week the EIA chimed in with a forecast that prices are likely to be higher in the immediate future as supplies remain tight. The Administration says that US gas supplies are not growing as rapidly as previously expected and that demand is increasing because of aberrant weather, the move to more gas-fired electricity production, and the prospect of increased exports.
Prospects for Libyan oil exports dimmed this week as the deal to open the four Eastern Libyan oil export terminals broke down. Two of the smaller terminals had already been exporting small amounts of crude, but even these may be shut down again. An attempt to elect a new Libyan prime minister came to naught this week when the Congress seems to have voted to reject the new prime minister that they just elected only a few hours after he was sworn in.
The Ukrainian situation remains as serious as ever. There has been more fighting between Moscow supported pro-Russian militants and Ukrainian military and police forces. The government is trying to hold new presidential elections later this month, but this is opposed by Moscow. In the meantime the EU continues to search for new sources of natural gas in the event the Russian supplies are lost in the dispute.
The Iraqi situation is about the same with bombs going off at regular intervals and the vote counting continuing.  Preliminary results of the voting are expected on May 15th, but then the lengthy period of coalition building begins as no party is likely to have a majority.