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The American Petroleum Institute (API) reported a build of 6.181 million barrels in United States crude oil inventories, compared to analyst expectations that inventories would build by 10.1 million barrels for the week ending September 8 as many refineries in the Gulf Coast remain offline and demand in Florida wanes in the wake of the most recent hurricane.
Gasoline inventories fell more than anticipated—by 7.896 million barrels for the week ending September 8, against an expected draw of 4.0 million barrels.
Crude oil prices rose on Tuesday as OPEC reported lowered production in August—down to 32.755 million barrels daily per month in August, down from 32.834 million bpd in July, according to OPEC’s Monthly Oil Market Report published on Tuesday. The production decreases were more due to Libya’s unrest that saw a 112,300-barrel decline in August’s production, rather than a conscious effort to adhere to the cartel’s production cut deal.
WTI climbed 0.4% by 2:15pm EST to $48.26, and Brent prices increasing by 0.72% to $54.23. Gasoline was also trading up—1.29%—but almost flat on the week at $1.6556 as much of the refining capacity in the Gulf Coast comes back online.
Related: Is It Time For OPEC To Turn The Taps Back On?
This week’s crude oil inventory build takes away from the previous streak of draws that saw almost 50 million barrels removed from inventory, according to API data. The total draw for crude oil in 2017 now stands at 23 million barrels.
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Distillate inventories fell this week, by 1.805 million barrels, against a smaller expected draw of 300,000 bpd. Inventories at the Cushing, Oklahoma, site increased by 1.320 million barrels.
By 4:40pm EST, WTI was trading at $48.18 with Brent Crude trading at $54.21.
The U.S. Energy Information Administration report on oil inventories is due on Wednesday at 10:30 a.m. EDT.
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.