• 2 minutes Oil Price Could Fall To $30 If Global Deal Not Extended
  • 5 minutes Middle East on brink: Oil tankers attacked off Oman
  • 8 minutes CNN:America's oil boom will break more records this year. OPEC is stuck in retreat
  • 2 hours Here We Go: New York Lawmakers Pass Aggressive Law To Fight Climate Change
  • 1 hour Iran downs US drone. No military response . . Just Completely Destroy their Economy. Can Senator Kerry be tried for aiding enemy ?
  • 5 hours The Inconvenient Truth Of Electric Cars
  • 5 hours Ireland To Ban New Petrol And Diesel Vehicles From 2030
  • 1 hour Oil Demand Needs to Halve: Equinor
  • 15 hours Win Against Tyranny: Turkey's Opposition Strikes Blow To Erdogan With Istanbul Mayoral Win
  • 6 hours NATO Article 5: Attack on one member is attack on all. Members all must come to defense . . . NOT facilitate financial transactions to circumvent and foil US Sanctions. Somebody please tell Angela.
  • 14 hours Green vs. Coal: Bavaria Seeks Fast-Track German Coal Exit in Snub to Merkel Plan
  • 3 hours Magic of Shale: EXPORTS!! Crude Exporters Navigate Gulf Coast Terminal Constraints
  • 2 hours The Plastics Problem
  • 2 hours Hydrogen FTW... Some Day
  • 5 hours Is $60/Bbl WTI still considered a break even for Shale Oil
  • 46 mins Section 232 Uranium
  • 12 hours California and Oil
U.S. Utilities Boost Production But See Profits Drop

U.S. Utilities Boost Production But See Profits Drop

The U.S. Electric Industry churned…

EIA’s Report Dampens Optimism

Barrels

A day after the American Petroleum Institute brought back some optimism to markets by reporting a much-awaited-but-slim draw to U.S. crude oil inventories, the EIA reversed the mood by reporting an even slimmer decline in inventories for last week of 200,000 barrels.

The API figure, although paling against a cumulative build of 34.6 million barrels for the last 11 weeks, helped prop up oil prices yesterday, after they suffered a blow from reports about an increase in Saudi Arabia’s February crude oil output.

The EIA’s report is likely to dampen the hopeful sentiment on an already excessively volatile market.

The authority reported that total inventories stood at 528.2 million barrels at the end of last week, still above the upper end of the seasonal average.

In gasoline inventories, things looked better: these were down by 3.1 million barrels last week, almost half the hefty 6.6-million-barrel draw in the week to March 2, but still substantial. Gasoline production last week averaged 9.5 million barrels daily, down from 9.8 million barrels in the previous week.

Refineries processed an average of 15.5 million barrels of crude, unchanged from the previous week.

Last week, the EIA estimated that U.S. crude oil production will reach 9.7 million barrels daily by 2018, which would represent a new historic high and a major drag on international prices.

Related: Why Last Week’s Oil Price Crash Was Inevitable

Saudi Arabia’s statement that its output had grown in February on a monthly basis, to 10.01 million bpd, sent both major benchmarks off a cliff, with WTI dipping to $47.71 a barrel in intraday trading, and Brent coming close to breaking the psychologically significant $50 price level.

The Kingdom insisted that this higher output figure does not mean it is going back on its pledge to help rebalance the oil market and that it’s still committed to this task. Indeed, OPEC’s secondary sources, which calculate the cartel’s output every month, noted that February output had fallen by 139,000 bpd, to a total of 31.96 million bpd, which is below the target figure of 32.5 million barrels. Yet it seems that this has not been enough to reassure traders that the glut is easing.

At the time of writing, WTI traded at $48.62 a barrel and Brent had inched up above $50, changing hands at $51.81 a barrel.

By Irina Slav for Oilprice.com

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage

Leave a comment

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News