US: EIA Petroleum Status Report

Thu Feb 22 10:00:00 CST 2018

Actual Previous
Crude oil inventories (weekly change) -1.6M barrels 1.8M barrels
Gasoline (weekly change) 0.3M barrels 3.6M barrels
Distillates (weekly change) -2.4M barrels -0.5M barrels

Following three weeks of increases, crude oil inventories resumed their longer term downtrend and fell 1.6 million barrels in the February 16 week to 420.5 million, 18.9 percent below the level a year ago. Gasoline inventories rose 0.3 million barrels from the prior week to 249.3 million, 2.8 percent below last year at this time, while inventories of distillates fell 2.4 million barrels to 138.9 million, down 15.9 percent year-on-year. The weekly decline in crude oil inventories exceeded the 0.9 million barrels draw reported Wednesday by the American Petroleum Institute (API), a private industry group. WTI prices jumped about $1.00 higher to around $62.60 per barrel immediately following the release of the EIA report.

Refineries slowed down in the week to operate at 88.1 percent of their operable capacity, down 1.7 percentage points from the prior week. Gasoline production nevertheless rose, averaging 10.1 million barrels per day, while the production of distillate fell, averaging 4.5 million barrels per day.

Crude oil imports fell to an average of 7.0 million barrels per day, down 867,000 barrels per day from the prior week. The 4-week average of crude oil imports fell to 7.8 million per day, 6.6 percent less than the same period last year.

Demand remains strong though growth comparisons are slightly weaker than last week, with total products supplied averaging 20.6 million barrels per day over the last four weeks, up 4.3 percent from the same period last year. Of this amount, motor gasoline supplied averaged 9.1 million barrels per day, up 5.4 percent from last year, while distillates supplied were up 4.3 percent year-on-year at 4.1 million barrels per day.

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.