As doubts about the effectiveness of OPEC’s production cut deal continue to rise, the EIA reported a 2.4-million-barrel fall in commercial inventories for the week to December 2.
The report comes a day after the American Petroleum Institute estimated commercial inventories had declined by 2.21 million barrels in the same period. Strategic stockpiles in Cushing, Oklahoma, however, experienced the biggest weekly build since 2008, by 4.01 million barrels, according to the industry body
A poll among analysts before the API report expected crude inventories to have dropped by 1.13 million barrels in the week to December 2.
The EIA said that commercial crude oil stockpiles for the seven-day period totaled 485.8 million barrels, within the limits for this time of year.
Gasoline inventories were 3.4 million barrels higher than a week before, with daily production at 9.9 million barrels. In the prior week, gasoline stockpiles registered an increase of 2.1 million barrels as winter settles in and demand for gas declines.
Refineries processed 16.4 million barrels daily in the seven-day period, up slightly on the previous week’s 16.3 million barrels of crude.
Imports stood at 8.3 million barrels daily in the week to December 2, up by 755,000 barrels from a week previously. Related: How Russia Outsmarted OPEC
There has been growing criticism of such inventory data, whether from the API or EIA, with arguments largely focusing on the figures being “paper barrels” rather than real ones. Indeed, a few weeks ago the EIA reported a massive increase in commercial oil inventories, which turned out to be the result of a lag in the reporting of weekly import rates.
Even so, both API and EIA data are devoured eagerly by traders and routinely swing prices upward or downward. This week, EIA’s report is likely to add to worries that the OPEC deal will not go far enough to balance the oil market.
At 10.30 AM EST, Brent crude was trading at US$53.55 a barrel, and WTI was changing hands at US$50.37 a barrel, both down by less than 1 percent.
By Irina Slav for Oilprice.com
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