US Crude Oil Weekly Balance Up 5Mln Barrels, Most Since February - Energy Agency

Stockpiles of US crude rose by a little over 5 million barrels last week for their biggest weekly build since February, according to government data that defied market expectations for a drawdown amid bets for greater oil consumption in the run-up to the peak summer travel period

WASHINGTON (UrduPoint News / Sputnik - 17th May, 2023) Stockpiles of US crude rose by a little over 5 million barrels last week for their biggest weekly build since February, according to government data that defied market expectations for a drawdown amid bets for greater oil consumption in the run-up to the peak summer travel period.

The US crude inventory balance rose by 5.04 million barrels during the week ended May 12, according to the US Energy Information Administration (EIA), which serves as the statistical arm of the Energy Department. Industry analysts polled by US media had forecast a crude inventory slide of 920,000 barrels for the week. In the prior week to May 5, the EIA reported a build of 2.951 million barrels.

Historical data from the EIA showed the last time there was such a huge weekly build was during the week ended February 18, when crude stockpiles rose by 7.648 million barrels.

The crude build for the latest week, however, comes with a usual caveat: The release of 2.4 million barrels from the Strategic Petroleum Reserve (SPR), without which the inventory balance might have been smaller.

Crude releases from the SPR reserve have been a challenge to oil bulls as the Biden administration has sought to continuously moderate market optimism to prevent both oil and pump prices of fuel from rising too much to add to already high inflation.

The administration has drawn almost 250 million barrels from the reserve over the past 18 months, bringing pump prices of gasoline in the United States to around $3.50 per gallon on the average from a June 2022 record high of $5.

Demand for fuels last week was also mixed last week, defying to an extent greater consumption ahead of the typical summer surge in road, air and seaborne travel.

The EIA reported a gasoline inventory slide of 1.381 million barrels for the week ended May 12, versus forecasts for a drop of 1.06 million barrels. In the previous week to May 5, there was a drawdown of 1.06 million barrels. Automotive fuel gasoline is the main US fuel product.

With distillate stockpiles, the EIA reported a build of 80,000 barrels last week versus forecasts for a drop of 57,000 barrels. In the prior week, distillates saw a huge slide of 4.17 million barrels. Distillates are refined into heating oil, diesel for trucks, buses, trains and ships and fuel for jets.