Surprise Crude Oil Inventory Build Ends 5-Week Draw Streak

The American Petroleum Institute (API) estimated that crude oil inventories in the United States rose this week, this time by 680,000 barrels in the week ending June 27 after analysts had estimated a 2.26-million-barrel draw. The build ends a series of API-reported draws over the last five weeks that total more than 22 million barrels—an unprecedented drop in US inventories not seen in recent history.

Yet so far this year, crude oil inventories are up 4 million barrels, according to Oilprice calculations of API data.

Earlier this week, the Department of Energy (DoE) reported that crude oil inventories in the Strategic Petroleum Reserve (SPR) climbed 300,000 barrels to 402.8 million barrels in the week ending June 27. Inventory levels in the SPR are hundreds of millions shy of the levels in inventory prior to the SPR withdrawal that took place under the Biden Administration.

At 9:30 am ET, Brent crude was trading up $0.44 (+0.66%) on the day, landing at $67.18—nearly even with a week ago.

WTI was also trading up on the day, by $0.50 (+0.77%) at $65.61—a roughly $1 increase from last week’s level.

Gasoline inventories rose in the week ending June 27 by 1.920 million barrels, on top of last week’s 764,000 barrel increase in the week prior. As of last week, gasoline inventories were 3% below the five-year average for this time of year, according to the latest EIA data.

Distillate inventories fell this week by 3.458 million barrels. In the week prior, distillate inventories slipped 1.026 million barrels. Distillate inventories were already a staggering 20% below the five-year average as of the week ending June 20, the latest EIA data shows.

Cushing inventories—the benchmark crude stored and traded at the key delivery point for U.S. futures contracts in Cushing, Oklahoma—fell 1.417 million barrels in the week after falling 75,000 barrels in the week prior.