|Crude oil inventories (weekly change)||6.3M barrels||8.9M barrels|
|Gasoline (weekly change)||2.3M barrels||-2.6M barrels|
|Distillates (weekly change)||1.8M barrels||-3.9M barrels|
Refinery production continues to slow, the result of outages in the Midwest and Gulf Coast which contributed to a 4th straight large build for weekly oil inventories, up 6.3 million barrels in the January 30 week to a new 80-year high of 413.1 million barrels. Despite slowing refinery production, inventories of gasoline and distillates both rose in the week, up 2.3 million and 1.8 million barrels respectively. Pointing to further refinery slowing ahead are wholesale supplies which remain very heavy, up a year-on-year 6.3 percent for gasoline and up 4.7 percent for distillates. WTI oil is falling sharply in reaction to the run of builds, down nearly $1 and testing support near $50.
The Energy Information Administration (EIA) provides weekly information on petroleum inventories in the U.S., whether produced here or abroad. The level of inventories helps determine prices for petroleum products.
Petroleum product prices are determined by supply and demand - just like any other good and service. During periods of strong economic growth, one would expect demand to be robust. If inventories are low, this will lead to increases in crude oil prices - or price increases for a wide variety of petroleum products such as gasoline or heating oil. If inventories are high and rising in a period of strong demand, prices may not need to increase at all, or as much. During a period of sluggish economic activity, demand for crude oil may not be as strong. If inventories are rising, this may push down oil prices.
Crude oil is an important commodity in the global market. Prices fluctuate depending on supply and demand conditions in the world. Since oil is such an important part of the economy, it can also help determine the direction of inflation. In the U.S., consumer prices have moderated whenever oil prices have fallen, but have accelerated when oil prices have risen.
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