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Large Crude Inventory Draw Bolsters Prices

The American Petroleum Institute (API) reported a large crude oil inventory draw of 7.55 million barrels for the week ending June 20, but still coming in over analyst expectations of a 2.891-million barrel drawdown in inventories.

Last week, the API reported a draw of 812,000 barrels. A day later, the EIA estimated that US inventories had drawn down by 3.1 million barrels.

The net build is still 26.69 million barrels for the 26-week reporting period so far this year, using API data.

(Click to enlarge)

Oil prices were up earlier on Tuesday as the general expectation was for a drawdown in crude oil inventories in the runup to the data release. Another headwind for higher prices is the continuing tensions in the Middle East.

At 12:32pm EST, WTI was trading up by $0.13 (+0.22%) at $58.03—roughly $4.00 over last week’s levels. Brent was trading up $0.24 (+0.37%) at $64.42—about $2.00 more than last week’s figures.

The API this week reported a 3.17 million-barrel draw in gasoline inventories for week ending June 20. Analysts estimated a build in gasoline inventories of 217,000 barrels for the week.

Distillate inventories rose by 160,000 barrels for the week, while inventories at Cushing fell by 1.26 million barrels.

US crude oil production as estimated by the Energy Information Administration showed that production for the week ending June 14 fell again this week to 12.2 million bpd, a 200,000 dip from the all-time high of 12.4 million barrels per day.  

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 at $57.87 and Brent was trading at $64.30

By Julianne Geiger for Oilprice.com

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  • Daniel Oliveros on June 26 2019 said:
    I suppose that they are speaking about of others market´s analysts (traders, bankers, financial analysts) think that the only reduction is 2.891-million barrel
  • Wade Adams on June 26 2019 said:
    I do not understand your first sentence. What does it mean "The American Petroleum Institute (API) reported a large crude oil inventory draw of 7.55 million barrels for the week ending June 20, but still coming in over analyst expectations of a much bigger 2.891-million barrel drawdown in inventories." Last I checked 2.891 million is LESS than 7.55 million barrels. And both numbers refer to inventory draw. Well actually one is a draw, and the other is a drawdown.

    Thanks.
  • Richard Cooksey on June 25 2019 said:
    What's interesting is that for the last few weeks US EIA reports have been out by 21+ mbl
    It seems the 1.00pm report includes the "ethanol fuel" twice. The report doesn't add up correctly and generally its by the same amount.
    Report from 6/14/19 is 482.4, 233.2, 127.8, 451.8 & 644.8 it equals 1940.0 not 1961.6
    No one has corrected this error for weeks and it clearly should be lower inventories than where they actually are today...

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