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The American Petroleum Institute (API) reported a draw of 5.222 million barrels of United States crude oil inventories for the week ending December 15, marking three large draws in as many weeks. Analysts had expected a smaller drawdown of 3.518 million barrels of the fuel.
Last week, the American Petroleum Institute (API) reported a large draw of 7.385 million barrels of crude oil, but had dampened enthusiasm that the oil bulls may have had by countering that with a build of 2.334 million barrels of gasoline.
This week, the API is reporting yet another build in gasoline inventories at 2.001 million barrels for the week ending December 15. The results came in close to forecasts for a 2.231-million-barrel build.
WTI and Brent were trading up earlier in the day as an Ineos press release foretold of weeks of delays on its Forties pipeline as custom parts are built, causing the pipeline to be shut down until then after a crack had been discovered. That pipeline outage, according to Bloomberg, is expected to take between 5.5 million and 13 million barrels of oil out of the market before the repairs are complete.
By Tuesday 10:32am EST, WTI was trading up .40% at $57.47 per barrel, while Brent crude was trading up .54% at $63.25.
Distillate inventories saw a draw this week, down 2.85 million barrels, against a forecast of a 1.327-million-barrel draw.
Inventories at the Cushing, Oklahoma, site increased by a modest 70,000 barrels this week.
The dip in US crude oil inventories comes after weeks and weeks of increasing oil production in the United States, growing from an average of 8.946 million bpd in the first week of January of this year and reaching an average of 9.780 million bpd for week ending December 8.
The U.S. Energy Information Administration report on oil inventories is due to be released on Wednesday at 10:30 a.m. EDT.
By 4:36pm EST, the WTI benchmark was trading up 0.63% on the day to $57.58, while Brent was trading up 0.72% on the day at $63.36.
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.
And besides, it gives Oil companies an opportunity to increase profits so the can pay future lawsutis.