Crude oil inventories in the United States dropped by 21.8 million barrels to 915.8 million barrels in June, which was the lowest level since 2004, the latest data from the Joint Organisations Data Initiative (JODI) showed on Wednesday.
Product inventories, on the other hand, rose by 34.1 million barrels to 650.5 million barrels, according to the data from JODI, which compiles self-reported data from countries.
The low crude inventory levels in the United States in June coincided with the latest rally in oil prices in the early days of the month when the EU announced an embargo on imports of seaborne Russian crude and petroleum products, to enter in full force in early 2023.
In the second week of June, U.S. gasoline prices jumped to exceed a national average of $5 per gallon, a record high. The $5 threshold had been widely expected for weeks, considering the rise in international crude oil prices, the constrained refinery capacity in the United States, the robust demand despite record-high prices, and multi-year low fuel inventories in the U.S.
After the middle of June, however, fears on the global markets of a recession in many countries resulted in several heavy sell-offs in oil, and oil prices have dropped to below $100 per barrel. As a result of declining international crude prices, the average U.S. gasoline price dropped last week to below $4 per gallon for the first time since early March, as supply has risen and concerns about the economy have grown.
As of August 17, the national average was $3.943 per gallon, down from $4.532/gal a month ago, but still higher compared to the year-ago average of $3.183 per gallon, per AAA data.
In U.S. oil stocks, the latest industry data from the American Petroleum Institute (API) showed on Tuesday a draw for crude oil of 448,000 barrels, while analysts predicted a smaller draw of 117,000 barrels. The API also reported a draw in gasoline inventories of 4.480 million barrels for the week ending August 12, compared to the previous week’s 627,000-barrel draw.
U.S. crude inventories have shed some 61 million barrels since the start of 2021, with a 1.7 million barrel gain since the start of 2020, according to API data.
By Tsvetana Paraskova for Oilprice.com
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