EIA: US crude oil inventories drop more than expected, at a 2-1/2-year-low
The Energy Information Administration reported on Wednesday that U.S. crude oil stocks fell by more than expected last week and reached their lowest level for nearly two-and-a half years.
The EIA reported that crude stocks fell by 4.5m barrels, to 413m barrels for the week ending Sept. 20. This was compared to analysts' expectations based on a poll of 1.4m barrels.
Last week, U.S. crude oil inventories, excluding the Strategic Petroleum Reserve (SPR), were at their lowest level since April 2022.
The EIA reported that stocks at Cushing, Oklahoma's delivery hub for U.S. Crude Futures increased by 116,000 barrels. This is the first increase since August began.
Josh Young, Chief Investment Officer for Bison Interests, said that even oil bears recognize the current undersupply of the market. He warned that there is a strong market sentiment that stocks will be oversupplied next year.
Following the report, oil futures pared their losses. Brent crude traded at $74.82 per barrel by 11:06 am EDT (1506 GMT), down about 35 cents, while U.S. West Texas Intermediate was down 49 cents at $71.06 per barrel.
Refinery crude runs dropped by 124,000 barrels a day. Utilization rates also fell by 1.2 points, to 90.9%.
The EIA reported that gasoline stocks dropped by 1.5 million barrels last week, to 220.1 million, as opposed to expectations of a 21,000 barrel draw. ?
The EIA reported that distillate stocks, which includes diesel and heating oil fell by 2.2 millions barrels last week, exceeding expectations of a drop of 1.6 million barrels.
Last week, distillate inventories in the U.S. Gulf Coast region fell by the most since September 2021.
The trend of falling supply is too large to ignore. Phil Flynn is an analyst at Price Futures Group. He added that "the weakness of demand does not fit with the falling inventory situation."
EIA reported that net U.S. crude exports fell by 692,000 barrels per day to 3.9 millions bpd, while imports increased by 826,000 bpd. (Reporting and editing by Margueritachoy in Denver)
(source: Reuters)
