Crude Oil Inventory Drop Falls Short of Expectations
Crude oil inventories in the United States fell by 1.5 million barrels for the week ending September 27, according to The American Petroleum Institute (API). Analysts had expected a drop of 2.1 million barrels.
For the week prior, the API reported a 4.339-million-barrel decrease in crude inventories.
So far this year, crude oil inventories nearly 17 million barrels under where they were at the start of the year, according to API data.
On Tuesday, the Department of Energy (DoE) reported that crude oil inventories in the Strategic Petroleum Reserve (SPR) rose by 0.7 million barrels as of Sept 27. Inventories are now at 382.6 million barrels. The SPR is now up more than 35 million from its multi-decade low last summer, although still down 252 million from when President Biden took office. At the current rate of replenishment, it will take more than five years to return to January 2020 levels.
Oil prices rose sharply on Tuesday ahead of the API data release after Iran fired more than 100 ballistic missiles into the center of Israel, with the world fearing the latter’s reprisal. At one point, oil prices were trading up more than 5% on the day.
At 3:17 pm ET, Brent crude was trading up $2.08 (+2.90%) on the day at $73.78—but still down roughly $1.40 from this time last week. The U.S. benchmark WTI was also trading up on the day by $1.95 (+2.86%) at $70.12—$1.50 per barrel under where they were this time last Tuesday.
Gasoline inventories rose this week by 900,000 barrels, compared to last week’s 3.438-million-barrel decrease. As of last week, gasoline inventories are 1% below the five-year average for this time of year, according to the latest EIA data.
Distillate inventories fell by 2.7 million barrels, on top of last week’s 1.115-million-barrel decrease. Distillates were already about 9% below the five-year average as of the week ending September 20, the latest EIA data shows.
Cushing inventories rose for the week by 700,000 barrels, according to API data, compared to the 26,000-barrel draw of the previous week.