|Crude oil inventories (weekly change)||10.3M barrels||8.4M barrels|
|Gasoline (weekly change)||0.0M barrels||-3.1M barrels|
|Distillates (weekly change)||-1.7M barrels||-2.7M barrels|
The string is now at 8 straight large builds for oil inventories which rose an extremely steep 10.3 million barrels in the February 27 week. Commercial inventories now stand at 444.4 million barrels for yet another 80-year high.
Refineries are cutting back production which is contributing to the oil build and is now holding down product inventories where gasoline is unchanged in the week and distillates down 1.7 million barrels.
The petroleum glut extends to the wholesale sector where gasoline supplies are up a year-on-year 4.0 percent, which is very high for this reading, and distillates up 16.8 percent, which is extremely high. WTI oil is down 75 cents to $49.75 in early reaction to 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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