EIA Inventory Report Fails To Arrest Oil Price Rally

Oil prices continued higher today even after the Energy Information Administration reported that U.S. crude oil inventories had added 4.5 million barrels in the week to February 18.

This compared with a build of 1.1 million barrels for the previous week.

In fuels, the EIA reported draws.

Gasoline inventories, according to the agency’s estimates, shed 600,000 barrels in the week to February 18, which compared with a decline of 1.3 million barrels for the previous week.

Production of gasoline last week averaged 9.3 million barrels per day, which compared with 8.8 million barrels per day a week earlier.

In middle distillate fuels, the EIA estimated an inventory draw of 600,000 barrels for the week to February 18, which compared with a draw of 1.6 million barrels a week earlier.

Middle distillate fuel production averaged 4.7 million barrels daily last week, which compared with 4.6 million barrels daily a week earlier.

Refineries processed 15.2 million barrels per day last week, which compared with 14.9 million barrels per day during the previous week.

Imports last week averaged 6.8 million bpd in the week to February 18, which compared with 5.8 million bpd a week earlier.

Brent crude topped $100 per barrel this week after the latest developments in Ukraine, which represent a sharp escalation to an open military conflict between Russian and Ukrainian forces.

Sanctions against Russia announced by the UK, the EU, and the United States earlier this week also served to push prices higher on worries that Russia may decide to shrink its oil and gas exports, disrupting global supply balance. More sanctions are on the table, as well.

At the time of writing, Brent crude was over $103 per barrel after touching $105, with West Texas Intermediate at close to $98 per barrel. Both benchmarks were up by more than 6 percent from opening. This is the first time since 2014 when Brent has traded over $100 per barrel.

By Irina Slav for Oilprice.com

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