Crude Inventories Decline By 12.2 Million Barrels, Missing Analyst Estimates

On July 3, 2024, EIA released its Weekly Petroleum Status Report. The report indicated that crude inventories decreased by 12.2 million barrels from the previous week, compared to analyst consensus of -0.9 million barrels. At current levels, crude inventories are about 4% below the five-year average for this time of the year.

Total motor gasoline inventories declined by 2.2 million barrels from the previous week, compared to analyst consensus of -1 million barrels. Distillate fuel inventories declined by 1.5 million barrels.

Crude oil imports decreased by 65,000 bpd, averaging 6.5 million bpd. Over the past four weeks, crude oil imports averaged 7.1 million bpd.

Strategic Petroleum Reserve increased from 372.2 million barrels to 372.6 million barrels as U.S. continued to buy oil for reserves.

Domestic oil production remained unchanged at 13.2 million bpd. It remains to be seen whether current oil prices provide sufficient incentives to push production towards the 13.5 million bpd level.

WTI oil pulled back as traders reacted to the report. Traders continued to take profits off the table near multi-week highs. Currently, WTI oil is trying to settle below the $82.50 level.

Brent oil declined below the $86.00 level amid profit-taking. The significant decline in crude inventories did not provide support to oil markets.

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