Oil unmoved by crude, gasoline draws

Crude oil prices moved little after the U.S. Energy Information Administration reported inventories of the commodity had declined in the week to August 23.

Oil inventories shed 800,000 barrels in the reporting period, compared with a draw of 4.6 million barrels for the previous week.

A week before the EIA’s report was out, the American Petroleum Institute reported an estimated crude oil inventory draw of 3.4 million barrels for the week to August 23, largely in line with analyst expectations.

In fuels, the EIA estimated mixed inventory changes.

Gasoline stocks shed 2.2 million barrels in the week to August 23, with production at an average of 9.6 million barrels per day.

This compared with a draw of 1.6 million barrels for the previous week, when gasoline production averaged 9.8 million barrels daily.

In middle distillates, the authority estimated an inventory rise of 300,000 barrels, with production standing at an average 5 million barrels per day.

This compared with a stock decline of 3.3 million barrels for the previous week, when middle distillate production averaged 4.9 million barrels daily.

WTI crude was trading at $74 per barrel after the EIA report was released, after dipping sharply on Tuesday, as traders were torn between supply worries amid Libya’s production shutdown, and demand suspicions on lower refining margins.

Libya is shutting down its oil fields amid a dispute between rival political factions. The fields being shut down are all in the east of the country, which is under the control of a government that is not internationally recognized. Per a Reuters report, some 1.2 million bpd in production could be shut down.

The geopolitical premium to oil prices remains in place as well as Israel continues to bomb Gaza and ceasefire talks stall, while Israel turns its missiles to Lebanon to pre-empt an attack threatened by Hezbollah.