Crude Oil Prices Jump as U.S Inventories Fall
Global prices of crude oil grades inched higher on inventory drawdowns in the United States (U.S) amidst distortion in the supply chain and expectation of a demand jump in China.
US crude oil stocks, including those in the Strategic Petroleum Reserve, fell by 7 million barrels following a decrease of 8.4 million barrels in the previous week.
Excluding inventories in the SPR, commercial crude oil stocks dipped by 1 million barrels after a 3.4 million barrel drop in the previous week, a smaller decline than the 2.1 million barrel decrease expected in a survey compiled by Bloomberg.
Stocks in the SPR plunged by 6 million in the week after falling by 5 million in the previous week. Overall crude oil stocks declined by 0.7% from the previous week and were down 14.5% from a year earlier.
Crude oil inventories are about 14% below the five-year average for this time of the year. Gasoline stocks fell by 500,000 barrels, smaller than the 1.6 million barrel decrease expected. Gasoline stocks were down 0.2% from the previous week and down 5.5% from a year earlier.
Distillate stocks rose by 1.7 million barrels in the current week, compared with an expected increase of 1 million barrels. Distillate stocks were up 1.6% from the previous week and were 17.2% lower than in the same week a year ago.
Refineries operated at 93.2% of their capacity, up from 91.8% in the previous week. Throughput at Gulf Coast refiners also hit their highest level since January 2020, slowing the drawdown in fuel inventories and providing some relief for tight markets, ANZ Bank said in a report.
The U.S strategic petroleum reserve has fallen to its lowest level since September 1987 as sales from the reserve remained strong, ANZ Bank said. The stockpile dropped around 6.0 million barrels last week.
The market continues to watch out for potential European sanctions on Russian oil, but the country’s producers are struggling to sell barrels in Europe, the bank said. READ: Crude Oil Prices Edge Higher as Nigerian Grades Firm
Cargoes from Baltic ports are heading to refineries in Asia in longer voyages, as deliveries to the Netherlands and France have diminished to near zero, according to ANZ Bank. # Crude Oil Prices Jump as U.S Inventories Fall