A day after the American Petroleum Institute took markets by surprise with a massive, 11-million-barrel inventory draw, the Energy Information Administration reported the draw was actually much smaller, at 4.9 million barrels.
Analysts surveyed by S&P Global Platts had forecast a draw of 3.5 million barrels, with gasoline stockpiles seen to have increased by 2.3 million barrels in the first week of January. Gasoline stockpiles, according to the EIA rose by a hefty 4.1 million barrels in the reporting period.
The analysts noted that a build in fuel inventories is usual for this time of year, but this time it was likely to be smaller than usual because of the unusually cold weather. Still, gasoline inventories in the prior week, to December 29, 2017, rose by 4.8 million barrels.
The EIA also said that refineries processed 17.3 million barrels of crude daily in the week to January 5, producing 9.5 million barrels of gasoline, versus 9.7 million bpd in the last week of December 2017, which should explain the gasoline build.
A day before the release of the weekly inventory figures, the EIA shook markets with the latest edition of its Short-Term Energy Outlook, in which the authority forecast U.S. oil production would reach 10.3 million barrels daily this year and rise further to 11 million bpd in late 2019. This would make the country the world’s largest crude oil producer, as long as Saudi Arabia and Russia continue pumping at their current levels.
The EIA also revised upwards its global oil demand outlook by 100,000 bpd that helped push prices higher even before the release of the API estimate.
By Irina Slav for Oilprice.com
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