US: EIA Petroleum Status Report

Wed Sep 27 09:30:00 CDT 2017

Actual Previous
Gasoline (weekly change) 1.1M barrels -2.1M barrels
Distillates (weekly change) -0.8M barrels -5.7M barrels
Crude oil inventories (weekly change) -1.8M barrels 4.6M barrels

Gasoline stocks, up 1.1 million barrels in the September 22 week to 217.3 million barrels, are rebuilding after 3 weeks of steep draws following Hurricane Harvey's landfall in Texas. Distillate stocks are still down, 0.8 million barrels lower in the week at 138.0 million.

Commercial crude stocks also fell, down 1.8 million barrels to 471.0 million. When including the strategic reserve, which was drawn down 0.8 million barrels in the week in support of energy production in the wake of Hurricane Irma, stocks fell 2.6 million barrels to 1.15 billion.

Refineries are upping their production following the hurricane interruptions, operating at 88.6 percent of capacity, up 5.4 percentage points following a 5.5 point increase in the prior week. The price of West Texas Intermediate is down slightly following the results, just under $52.

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.