U.S. crude oil inventories registered a sharp weekly decline, although the year-to-date balance still shows a significant increase in the country’s commercial inventories.
U.S. Crude Oil Inventories Show Larger-Than-Expected Decline
U.S. crude oil inventories decreased by 9.1 million barrels during the week ended May 15, according to estimates from the American Petroleum Institute. The figure significantly exceeded analysts’ forecasts, which anticipated a reduction of approximately 3.4 million barrels.
Furthermore, the data deepens the trend from the previous week, when crude oil inventories had already declined by 2.188 million barrels. Despite this recent contraction, the API estimates that U.S. crude inventories have accumulated an increase of 26 million barrels year-to-date.
Gasoline, Distillates, and Cushing Also Show Declines
Additionally, gasoline inventories fell 5.8 million barrels during the same period, after increasing 502,000 barrels the previous week. According to the most recent EIA data, gasoline stocks were already 5% below the five-year average for this time of year.
Similarly, distillate inventories declined 1 million barrels, following a previous drop of 319,000 barrels. This category includes diesel and heating oil, two key products for transportation, industry, and seasonal consumption. According to the EIA, distillates were 9% below the five-year average at the close of the week ended May 8.
In Cushing, Oklahoma, the delivery point for WTI futures contracts, inventories decreased 1.4 million barrels. This data typically receives special attention from the market because it reflects physical availability at one of the most relevant hubs for U.S. crude price formation.
The Strategic Reserve Remains Under Pressure
Meanwhile, the U.S. Strategic Petroleum Reserve continued to decline in an attempt to alleviate price pressure. During the week ended May 15, 9.9 million barrels were withdrawn from the SPR, bringing the total to 374.2 million barrels.
The weekly withdrawal ranks among the highest on record and keeps the reserve at historically low levels relative to its maximum capacity. This movement adds another signal of tension in available supply, especially in a scenario of high prices and geopolitical sensitivity.
U.S. Production on the Rise
However, oil production in the United States also showed an increase. According to the most recent EIA data, production rose to 13.710 million barrels per day during the week ended May 8, compared to 13.573 million barrels per day the previous week.
The increase represents 323,000 barrels per day more than a year earlier. This growth helps offset part of the inventory adjustment, although it does not yet eliminate the pressure generated by the decline in refined products, the reduction in Cushing, and the use of strategic reserves.
Brent and WTI React Amid Tight Supply and Geopolitical Risk
In the international market, Brent was trading at $111.10 per barrel, down 0.87% before the data release. Nevertheless, it maintained an advance of approximately $2 compared to the previous week. WTI, for its part, declined 0.18% to $104.20 per barrel, although it also remained above the previous week’s levels.
Finally, traders remain attentive to the evolution of supply, commercial inventories, and the Strategic Petroleum Reserve. The sharp weekly decline in U.S. crude oil inventories reinforces the perception of a tight market, while the year-to-date cumulative increase introduces an important nuance: the system still holds more inventory than at the beginning of the period, but with clear signs of drainage in recent weeks.
Source: Oil Price
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