US: EIA Petroleum Status Report

Wed Apr 25 09:30:00 CDT 2018

Actual Previous
Crude oil inventories (weekly change) 2.2M barrels -1.1M barrels
Gasoline (weekly change) 0.8M barrels -3.0M barrels
Distillates (weekly change) -2.6M barrels -3.1M barrels

Crude oil inventories rose 2.2 million barrels in the April 20 week to 429.7 million, 18.7 percent below their level a year ago. Product inventories were mixed, with gasoline up 0.8 million barrels to 236.8 million, 1.8 percent below last year at this time, but distillates down 2.4 million barrels to 122.7 million, down 18.7 percent year-on-year. The report's crude oil inventory increase was twice as large as the 1.1 million barrel build reported Tuesday by the American Petroleum Institute (API), a private industry group, and while the EIA's decline for distillates was slightly larger, the build for gasoline sharply contrasted with API's 2.7 million barrel draw. WTI prices, which Tuesday approached last week's 4-year highs before declining, fell further by about 50 cents to around $67.15 per barrel immediately following the release of the EIA report.

Refineries slowed to operate at 90.8 percent of their operable capacity during the week, down 1.6 percentage points from the prior week. Production declined, averaging 9.9 million barrels per day for gasoline and 5.0 million barrels per day for distillates.

Imports rose by 539,000 barrels per day in the week to an average of about 8.5 million barrels per day. Average daily imports over the last four weeks remained at 8.2 million barrels, 1.5 percent above the level in the same period last year.

Domestic crude oil production over the last four weeks remained steady at 10.5 million barrels per day, 14.0 percent higher than the production rate a year ago.

Overall product demand fell slightly as total product supplied over the last four weeks averaged 20.4 million barrel per day, but this is still up a respectable 4.3 percent from the same period last year. Demand for the main petroleum products continued to lag and remained softer, however, with motor gasoline supplied averaging 9.4 million barrels per day during the period, up 1.3 percent from the level a year ago, while distillates supplied averaged 4.0 million barrels per day, down 2.5 percent year-on-year.

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.