Prices Pressured Further with Inventory Build, Despite of Crude Draw

US crude oil stocks posted a decrease of 3.1 MMBbl from last week. Gasoline and distillate inventories increased 3.6 MMBbl and 5.7 MMBbl, respectively. Yesterday afternoon, API reported a crude oil draw of 1.4 MMBbl alongside a gasoline draw of 0.48 MMBbl and a distillate build of 6.2 MMBbl. Analysts were expecting a larger crude draw of 2.7 MMBbl. The most important number to keep an eye on, total petroleum inventories, posted a very large increase of 11.7 MMBbl. For a summary of the crude oil and petroleum product stock movements, see the table below. US crude oil production decreased 400 MBbl/d last week (due to Gulf of Mexico shut-ins), per the EIA. Crude oil imports were down 0.47 MMBbl/d last week, to an average of 6.8 MMBbl/d. Refinery inputs averaged 17.3 MMBbl/d (0.17 MMBbl/d less than last week’s average), leading to a utilization rate of 94.4%. Although crude oil withdrawal is higher than expected, large total petroleum stocks build is pressuring prices. Prompt-month WTI was trading down $0.28/Bbl, at $57.34/Bbl, at the time of writing. Escalating tensions in the Middle East between the US and Iran and the impact of Tropical Storm Barry on Gulf of Mexico production had… continue reading

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Source: CTRM Center

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