US Crude Oil Inventories Continue to Fall Despite Glut Narrative

The American Petroleum Institute (API) estimated that crude oil inventories in the United States saw a large dip of 4 million barrels in the week ending October 24, when analysts had expected oil inventories to contract by a smaller 2.9 million barrels.

Crude oil inventories in the United States are so far showing a net loss of 6.4 million barrels for the year, 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) have risen by 500,000 barrels to 409.1 million barrels in the week ending October 24 as the government attempts to replenish the nation’s oil stockpile that shrank during the Biden Administration.

US production slipped slightly during the week of October 17, to 13.629 million bpd, according to the EIA. This is 94,000 bpd more than beginning of the year levels.

At 4:22 pm ET, Brent crude was trading down, by $1.41 (-2.15%) on the day, reaching $64.21. Brent prices have recovered $2.60 per barrel from this time last week. WTI was also trading down on the day, by $1.40 (-2.28%) at $59.91.

Gasoline inventories also saw a large decrease, of 6.3 million barrels in the week ending October 24, after losing 236,000 barrels in the week prior. As of last week, gasoline inventories were slightly below the five-year average for this time of year, according to the latest EIA data.

Distillate inventories also fell in the reporting period, losing 4.4 million barrels, on top of the week prior’s 974,000-barrel drawdown. Distillate inventories were already 7% below the five-year average as of the week ending October 17, the latest EIA data shows.

Cushing inventory—the inventory kept at the delivery hub for the WTI Crude futures contract—rose by 1.7 million barrels.

By Julianne Geiger for Oilprice.com

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