Oil Prices Fall After EIA Reports Crude Inventory Build

Crude oil fell today after the Energy Information Administration reported an inventory build of 1 million barrels for the week to November 5.

This compares with a build of 3.3 million barrels for the previous week and analyst expectations of a build of 1.9 million barrels.

At 435.1 million barrels, the EIA said, crude oil inventories were 7 percent below the five-year average for this time of year.

In fuels, inventory movements included a draw in gasoline and another one in middle distillates.

In gasoline, the authority estimated inventories had shed 1.6 million barrels in the week to November 5, while in middle distillates, inventories fell by 2.6 million barrels last week.

This compared with a gasoline stock decline of 1.5 million barrels for the previous week and a middle distillate build of 2.2 million barrels.

Gasoline production last week averaged 10.1 million bpd, with middle distillate production at 4.9 million bpd.

This compared with gasoline production of 10.2 million bpd for the previous week and middle distillate production of 4.8 million bpd.

Oil prices got a boost earlier this week after the U.S. government lifted travel restrictions for visitors from abroad—a move seen to provide strong support to jet fuel demand, which has been lagging behind other fuels because of such restrictions.

In a further boost for prices, the EIA said in its Short-Term Energy Outlook that demand for oil and oil products was recovering much faster than supply, driving prices higher.

To address this imbalance that has pushed retail fuel prices much higher than drivers are used to, the federal government was reportedly considering the release of crude from the strategic petroleum reserve, even though according to analysts such a release may not do much about prices.

At the time of writing Brent crude was trading at $84.68 per barrel and West Texas Intermediate was changing hands at $83.83 per barrel. Both were down on the opening of trade today.