Oil Prices Soar As Crude Oil Inventories Build Up

The American Petroleum Institute (API) has reported a build of 1.586 million barrels in U.S. crude oil inventories, compared to last week’s large 5.25-million-barrel draw.

Analysts were expecting an inventory draw of 1.650 million barrels for the week. The total number of barrels of crude oil moves so far this year is – 4 million, according to API data, and there is a net draw in crude inventories since April of more than 51 million barrels.

On Monday, the Department of Energy (DoE) reported that crude oil inventories in the Strategic Petroleum Reserve (SPR) rose by 300,000 barrels last week, with the SPR inventory still sitting at a near 40-year low of 351.5 million barrels, with total purchases for the SPR coming in at less than 4 million barrels since the Biden Administration began its buyback program.

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Oil prices were trading up on Tuesday ahead of the API data release, with Brent trading up 0.75% at $93.99 at 12:50 p.m. ET—a $0.65 dip week over week, while WTI was trading up on the day at 0.88%, at $90.47. WTI is down more than $1 per barrel from this same time last week.

Gasoline inventories fell this week by 70,000 barrels, compared to the 732,000 barrel build in the week prior.

Gasoline 732,000 inventories are roughly 3% less than the five-year average for this time of year. Distillate inventories fell by 1.698 million barrels, on top of the 258,000 barrel dip in the week prior, and are about 14% below the five-year average for this time of year.

Cushing inventories fell by another 828,000 barrels, after falling 2.564 million barrels last week, leaving less than 22 million barrels in Cushing.