Oil again rejected the sub $40.00 a barrel area as talk starts to circulate that we could see a significant drawdown in U.S. crude oil inventory. The whisper numbers are becoming louder as a historic drop in U.S. oil production, as well as a plunge in U.S. oil imports, could set the stage for another historical crude oil supply draw. Last week The Energy Information Administration reported that U.S. crude inventories fell by 10.6 million barrels for the week ended July 24, the largest weekly decline this year.

Some market prognosticators believe that we have an outside chance to beat that record this week. Market calls of draws anywhere from 4 million barrels to 12 million barrels are being thrown around, and it will be interesting to see if the draw is on the massive side, will it shock the oil trade out of its recent tight trading range. We get the first hint today at 3:30p central time when the American Petroleum Institute (API)reports its version of the supply data.  

RBOB futures should find support as refiners start to wind down the summer blends of gasoline. With refiners closing and cutting back, it could lead to an RBOB rally. There are concerns that U.S. RBOB demand is stagnating and helping the Brent-WTI spread driving it to a 2-month high. Still, some are worried that if the U.S. recovery stutters as OPEC raises output, it could lead to a new glut.

Reports that Saudi Aramco will delay the release of official selling prices for September crude sales until later this week or early next week, source says. Aramco typically releases its OSPs by the fifth day of each month; the delay may due to the Saudi public holiday. Or it could be that they want to see if they get better compliance from OPEC laggards Iraq, Nigeria, and Algeria.

Natural gas got a huge upside breakout with forecasts for a return to hot weather and better export demand on the LNG front. Oil Price reported that "LNG/feedgas export figures provided over the weekend, with Genscape estimating a 740 MMcf/d increase on Saturday.

Reuters is reporting that “Ukraine’s state energy firm Naftogaz said it would not resume buying natural gas from Russia, suspended since late 2015 until Moscow offered at competitive prices and conditions. Ukraine was one of Russia’s largest consumers of natural gas until the relations between the two ex-Soviet republics soured in 2014 when Moscow annexed the Crimea peninsula from its neighbor. Kyiv stopped buying Russian gas in November 2015, increasing purchases from Europe instead.”