The American Petroleum Institute (API) reported on Tuesday a build in crude oil inventories of 2.970 million barrels for the week ending September 4.
Analysts had predicted an inventory draw of 1.335-million barrels.
In the previous week, the API reported a draw in crude oil inventories of 6.360 million barrels, after analysts had predicted a smaller draw of 1.887 million barrels.
Oil prices were trading up on Tuesday afternoon before the API's data release, but the rising prices come only after a brutal trading day in the day prior when oil prices sunk to their lowest levels since June.
A half-hour before the data release, at 4:00 pm EDT, WTI had risen by $1.32 (+3.59%) to $38.08. While up significantly on the day, WTI is still trading nearly $5 per barrel under last week's levels. The Brent crude benchmark had risen by $0.97 at 4:00 pm (+2.44%) to $40.75-also nearly $5 per barrel under last week's levels
Oil production in the United States fell sharply for the last week in August, still down significantly from a high of 13.1 million bpd on March 13. U.S. oil production currently sits at 9.7 million bpd as of August 28, according to the Energy Information Administration-3.4 million bpd under March highs.
The API reported a large draw in gasoline inventories of 6.892 million barrels of gasoline for the week ending August 28-compared to last week's 5.761-million-barrel draw. Analysts had expected a much smaller 2.384-million-barrel draw for the week.
Distillate inventories were up by 2.293 million barrels for the week, compared to last week's 1.424-million-barrel draw, while Cushing inventory rose by 2.608 million barrels.
At 4:33 pm EDT, the WTI benchmark was trading at $38.00 while Brent crude was trading at $40.70.
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. More