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The American Petroleum Institute (API) estimated that there was a large surprise draw this week for crude oil of 6.1 million barrels after analysts predicted a build of 2.796 million barrels.
U.S. crude inventories have shed some 80 million barrels since the start of 2021 and about 22 million barrels since the start of 2022. Global crude stockpiles are also low, and the markets are spooked that they could fall even lower should Russia's crude oil exports be curtailed with sanctions.
In the week prior, the API reported a build in crude oil inventories of 5.983 million barrels after analysts had predicted a much smaller build of 767,000 barrels.
Oil prices were up sharply on Tuesday in the runup to the data release, even after the IEA Ministerial Meeting agreed to release 60 million barrels from Strategic Petroleum stockpiles around the world.
WTI was trading up 8.81% at $104.15 per barrel on the day at 2:00 p.m. EST—up $12 on the week. Brent crude was trading up 7.80% on the day at $105.61 per barrel on the day—up nearly $9 per barrel on the week.
U.S. crude oil production has held steady for three weeks in a row. For the week ending February 18—the last week for which the Energy Information Administration has provided data—crude oil production in the United States stayed at 11.6 million bpd. This is down 1.5 million bpd from the pre-pandemic era.
This week, the API reported a draw in gasoline inventories at 2.5 million barrels for the week ending February 25—compared to the previous week's 427,000-barrel build.
Distillate stocks saw an increase in inventory of 400,000 barrels for the week, after last week's 985,000 barrel decrease. Cushing saw a 1 million-barrel decrease this week. Cushing inventories stood at 23.8 million barrels as of February 18 and declining—down from 60 million barrels at the start of 2021, and down from 37 million barrels at the end of 2021.
At 4:55 pm, EST, WTI was trading at $106.07 (+10.81%), with Brent trading at $107.26 (+9.48%).
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.