Crude Inventories Drop By 0.8 Million Barrels

On August 28, 2024, EIA released its Weekly Petroleum Status Report. The report indicated that crude inventories declined by 0.8 million barrels from the previous week, compared to analyst consensus of -3 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, while analysts expected that they would drop by 1.5 million barrels. Distillate fuel inventories increased by 0.3 million barrels from the previous week.

U.S. crude oil imports declined by 92,000 bpd, averaging 6.6 million bpd. Over the past four weeks, crude oil imports averaged 6.4 million bpd.

Strategic Petroleum Reserve increased from 377.2 million barrels to 377.9 million barrels as U.S. continued to buy oil for reserves.

Domestic oil production decreased from 13.4 million bpd to 13.3 million bpd. From a big picture point of view, it looks that domestic producers are not ready to push production towards 13.5 million bpd at current oil price levels.

WTI oil moved away from session lows as traders reacted to the EIA report. Currently, WTI oil is trying to settle above the $74.70 level. Traders are worried about demand in China, but falling crude and gasoline inventories may provide some support to the market.

Brent oil climbed back above the $78.50 level after the release of the EIA data.

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