US: EIA Petroleum Status Report

Wed Aug 05 09:30:00 CDT 2015

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Crude oil inventories (weekly change) -4.4M barrels -4.2M barrels
Gasoline (weekly change) 0.8M barrels -0.4M barrels
Distillates (weekly change) 0.7M barrels 2.6M barrels

Imports fell and refinery demand rose, making for another heavy draw in oil inventories which fell 4.4 million barrels in the July 31 week to 455.3 million. Refineries are busy, operating at a very strong 96.1 percent of capacity in the week, and demand indications in the report point to continued strength ahead for refinery output. Product inventories rose in the week with gasoline up 0.8 million barrels and distillates up 0.7 million. WTI jumped about 50 cents to $46.75 in initial reaction to today's report before settling back slightly.

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.