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The American Petroleum Institute (API) reported another surprise build in crude oil inventory of 2.4 million barrels for the week ending May 17, coming in over analyst expectations of a 2.53-million-barrel drawdown in inventories.
Including this week’s data, the net build is now 31.92 million barrels for the 21-week reporting period so far this year, using API data.
Oil prices rose early on Tuesday before sinking in the early afternoon, with the market left wondering how to accurately weigh the geopolitical stressors such as sanctions on Iran and Venezuela, attacks on Saudi- and UAE-owned oil tankers off the Strait of Hormuz, and US/China trade talks.
WTI was trading down on Tuesday before the data release at $63.03, down $0.18 (-0.28%) on the day at 12:38pm. WTI was still trading $1 up week on week. The Brent benchmark was also trading down on the day at $71.83, down $0.14 (-0.19%) at that time. The Brent benchmark was trading up just $.40 week on week.
The API this week reported a small build in gasoline inventories for week ending May 17 in the amount of 350,000 barrels. Analysts estimated a draw in gasoline inventories of 1.516-million barrels for the week.
Distillate inventories fell by 240,000 barrels for the week, while inventories at Cushing rose by 870,000 barrels.
US crude oil production as estimated by the Energy Information Administration showed that production for the week ending May 10—the latest information available—fell for the second week in a row to 12.1 million bpd from the all-time high of 12.3 million bpd two weeks prior.
The U.S. Energy Information Administration report on crude oil inventories is due to be released on Wednesday at 10:30a.m. EST.
By 4:40pm EST, WTI was trading down at $63.01 and Brent was trading up at $72.04.
By Julianne Geiger for Oilprice.com
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Julianne Geiger is a veteran editor, writer and researcher for Oilprice.com, and a member of the Creative Professionals Networking Group.