US: EIA Petroleum Status Report

Thu Jan 18 10:00:00 CST 2018

Actual Previous
Crude oil inventories (weekly change) -6.9M barrels -4.9M barrels
Gasoline (weekly change) 3.6M barrels 4.1M barrels
Distillates (weekly change) -3.9M barrels 4.3M barrels

Crude oil inventories fell 6.9 million barrels in the January 12 week to 412.7 million, posting the ninth weekly drawdown in a row that widened the year-on-year decline by 1.8 percentage points to 15.0 percent. Product inventories were mixed, with gasoline up 3.6 million barrels to 240.9 million, 2.2 percent below the level a year ago, while distillates fell 3.9 million barrels to 139.2 million, down 17.7 percent year-on-year. Drawdowns in other products widened the decline in total commercial inventories to 13.8 million barrels. After yesterday's report of a smaller 5.1 million barrel draw in crude oil stocks by the American Petroleum Institute, a private industry group, WTI prices rose about 50 cents to around $64.00 per barrel following the release of the EIA report.

Refineries cut back operations to 93.00 percent of their operable capacity, down 2.3 percentage points from the prior week. Gasoline production nevertheless increased, averaging 9.7 million barrels per day, while the production of distillates fell to an average of 5.1 million barrels per day.

Crude oil imports rose by 292,000 barrels per day to a daily average of 8.0 million barrels. Over the last four weeks, crude oil imports averaged 7.9 million barrels per day, 3.7 percent less than in the same period last year.

Demand continues to strengthen, with total products supplied over the last four weeks averaging 20.5 million barrels per day, up 6.2 percent from the same period last year. Gasoline supplied averaged 8.9 million barrels per day during the period, up 3.9 percent year-on-year, while distillates supplied averaged 4.1 million barrels per day, 16.0 percent above the level a year ago.

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.