Crude oil prices moved lower today after the U.S. Energy Information Administration reported an inventory increase of 5.9 million barrels for the week to July 7.
This compared with a modest inventory draw of 1.5 million barrels for the previous week, which failed to move prices in any meaningful way.
In gasoline, the authority estimated an inventory draw and in middle distillates, it reported a sizeable inventory rise.
Gasoline stocks declined only marginally in the week to July 7, with production averaging 10.1 million barrels daily. Stocks are about 7% below the five-year seasonal average
This compared with an inventory draw of 2.5 million barrels for the previous week, suggesting healthy demand, and a production rate of 10.3 million barrels daily.
Middle distillate stocks increased by 4.8 million barrels last week, with production averaging 5.1 million barrels daily.
These figures compared with an inventory draw of 1 million barrels and an average production rate of 4.9 million barrels daily.
Prices, meanwhile, started trending higher earlier this week after forecasts from OPEC and the IEA saying oil demand and production controls were tightening global supply.
Additionally, signs began to emerge that Russian oil exports volumes are on the decline, too, contributing to oil’s upward trajectory.
On the other hand, the American Petroleum Institute reported a crude oil inventory build of over 3 million barrels for last week. It followed a weekly draw of over 4 million barrels but prices still moved higher thanks to the other bullish factors.
Meanwhile, the latest U.S. inflation report revealed inflation had eased, rising less than expected on an annual basis, at 3%, versus an expected 3.1%.
However, inflation excluding food and energy prices stood at 4.8% on an annual basis, which is still higher than the Fed would have liked.
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At the time of writing, Brent crude was trading at $80.25 per barrel and West Texas Intermediate was changing hands at $75.79 per barrel. Both were up from opening.
By Irina Slav for Oilprice.com
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A keen observer like myself can time US oil inventory build announcements with oil price rallies as punctually as Big Ben.
Dr Mamdouh G Salameh
International Oil Economist
Global Energy Expert
Rivian and Lucid still looking very much on sale for 2023 as equity names tho. Long International Business Machines strong buy.