Crude oil prices fell lower today after the Energy Information Administration reported a crude oil inventory increase of 1.6 million barrels for the week to November 22. The build in gasoline stockpiles, however, was larger—and distillate fuels booked a rise as well.
Analysts had expected a decline of about 350,000 barrels, after last week the EIA reported an inventory build of 1.4 million barrels. Despite the build, however, prices trended higher that day on renewed optimism about U.S.-Chinese relations.
Crude oil inventories are now 3 percent above the upper limit of the average for this time of the year, the EIA said.
The EIA also reported a sizeable 5.1-million-barrel build in gasoline stockpiles, with production averaging 10.1 million bpd last week. This compares with a 1.8-million-barrel increase in gasoline inventories a week earlier, with production averaging 10.1 million bpd.
In distillate fuels, the EIA reported an inventory increase of 700,000 barrels, compared with a decline of 2.5 million barrels a week earlier. Distillate fuel production last week averaged 5.1 million bpd, almost unchanged on the previous week.
Refineries processed 16.3 million barrels daily last week, the EIA said, slightly down from 16.4 million bpd a week earlier.
This week has been mixed for Brent crude and West Texas Intermediate. While both benchmarks began the week with dips, they had recouped some of their losses by Tuesday, strengthened by reports that OPEC had set the date—Tuesday, December 3—for its meeting to discuss next steps in the production cuts it agreed last December. There have also been reports that these cuts may be extended to end-June 2020.
The rally ended abruptly, however, later in the day, when the American Petroleum Institute reported an unexpected crude oil inventory increase of 3.64 million barrels, which pushed oil lower.
At the time of writing, Brent crude was trading at $63.17 per barrel, down by a third of a percent from the opening of trade and West Texas Intermediate was trading at $58.28 a barrel, also down from opening.
By Irina Slav for Oilprice.com
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