|Crude oil inventories (weekly change)||8.4M barrels||7.7M barrels|
|Gasoline (weekly change)||-3.1M barrels||0.5M barrels|
|Distillates (weekly change)||-2.7M barrels||-3.8M barrels|
The giant glut grows! Oil inventories swelled by a very sizable 8.4 million barrels in the February 20 week. This is the 7th straight large build which puts inventories at a 5th straight 80-year high of 434.1 million barrels. Helping to offset the latest week's build are product draws, down 3.1 million barrels for gasoline and down 2.7 million for distillates. But at the wholesale level, supplies of both gasoline, up 3.3 percent year-on-year, and distillates, up 11.2 percent, are still very heavy. WTI is steady near $49 following today's report.
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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