The U.S. Energy Information Administration said in its weekly report that crude oil inventories rose by 9.4 million barrels in the week ended March 18. Market analysts' expected a crude-stock rise of 3.0 million barrels, while the American Petroleum Institute late Tuesday reported a supply gain of 8.8 million barrels.
Supplies at Cushing, Oklahoma, the key delivery point for Nymex crude, fell by 1.258 barrels last week, the EIA said.
Total U.S. crude oil inventories stood at an all-time high of 532.5 million barrels as of last week, underlining concerns over a domestic supply glut.
The report also showed that gasoline inventories decreased by 4.6 million barrels, compared to expectations for a drop of 1.5 million barrels, while distillate stockpiles rose by 0.9 million barrels.
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My Take: We are only a few weeks away from a spike in gasoline and diesel demand. It happen each year. Refiners are taking as much of the cheap crude oil they can get because they know oil prices will be higher this summer. Crude oil inventory is not building because our production is going up. It is building because we are importing more. Refiners will soon be drawing a lot more crude oil from inventory to ramp up production of summer blend gasoline.
Oil Storage Report - March 23
Oil Storage Report - March 23
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: Oil Storage Report - March 23
Hi Dan,
<<My Take: We are only a few weeks away from a spike in gasoline and diesel demand. It happen each year. Refiners are taking as much of the cheap crude oil they can get because they know oil prices will be higher this summer. Crude oil inventory is not building because our production is going up. It is building because we are importing more. Refiners will soon be drawing a lot more crude oil from inventory to ramp up production of summer blend gasoline.>>
Logically, then, you'd conclude that because refiners are stocking up with "cheap imported oil," buys of that sort are what's driven up the price in recent weeks to $40bbl (?) (Ie, if there were truly a glut, refiners could fill their tanks but the price of crude wouldn't move.) And if the domestic rig count is going down, we assume that a comparable drop is going on around the planet (?)
<<My Take: We are only a few weeks away from a spike in gasoline and diesel demand. It happen each year. Refiners are taking as much of the cheap crude oil they can get because they know oil prices will be higher this summer. Crude oil inventory is not building because our production is going up. It is building because we are importing more. Refiners will soon be drawing a lot more crude oil from inventory to ramp up production of summer blend gasoline.>>
Logically, then, you'd conclude that because refiners are stocking up with "cheap imported oil," buys of that sort are what's driven up the price in recent weeks to $40bbl (?) (Ie, if there were truly a glut, refiners could fill their tanks but the price of crude wouldn't move.) And if the domestic rig count is going down, we assume that a comparable drop is going on around the planet (?)