Crude Prices Suppressed As API Reports Gasoline Build

As the price of Brent Crude hovers near the $80 mark, the American Petroleum Institute (API) reported a draw of 1.3 million barrels of United States crude oil inventories for the week ending May 18, compared to analyst expectations that this week would see a draw in crude oil inventories of 1.567 million barrels.

Last week, the American Petroleum Institute (API) reported a surprise build of 4.854 million barrels of crude oil.

The API reported a build in gasoline inventories for week ending May 18 in the amount of 980,000 barrels-in contrast to the 1.388-million-barrel draw that analysts had expected.

Oil prices rose Tuesday with Brent crude coming within pennies of the $80 threshold as concerns about tight supply fester in the wake of looming sanctions on Iran and impending doom of Venezuela's oil industry. The usual round of OPEC statements that it would be willing to turn on the taps to compensate for any shortfall created by Iran or Venezuela has failed to assuage market fears of tight supply.

At 12:49p.m. EDT on Tuesday, WTI Crude was up 0.32 percent at $72.58. Brent crude was trading up 0.86% at $79.90. Both benchmarks are trading up week over week.

US crude oil production for yet another week for week ending May 11-the most recent data available-increased to 10.723 million bpd, according to the EIA.

Distillate inventories saw a draw this week 1.3 million barrels, largely in line analyst forecasts that we would see a decline of 1.335 million barrels.

Inventories at the Cushing, Oklahoma, site fell by 822,000 barrels.

The U.S. Energy Information Administration report on oil inventories is due to be released on Wednesday at 10:30a.m. EST.

By 4:39pm EST, the WTI benchmark was trading down 0.46% on the day to $72.02 while Brent was trading up 0.21% at $79.39.

By Julianne Geiger for Oilprice.com

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