US: EIA Petroleum Status Report

Wed May 16 09:30:00 CDT 2018

Actual Previous
Crude oil inventories (weekly change) -1.4M barrels -2.2M barrels
Gasoline (weekly change) -3.8M barrels -2.2M barrels
Distillates (weekly change) -0.1M barrels -3.8M barrels

Crude oil inventories fell 1.4 million barrels in the May 11 week to 432.4 million, 17.0 percent below their level a year ago. Product inventories also declined, with gasoline down 3.8 million barrels to 232.0 million, 3.6 percent below last year at this time, and distillates down 0.1 million barrels to 114.9 million, 21.7 percent lower year-on-year. The crude oil draw contrasted with a weekly build of 4.9 million barrels reported Tuesday by the American Petroleum Institute (API), a private industry group. WTI prices rose about 60 cents to around $71.30 per barrel immediately following the release of the EIA report.

Refineries operated at 91.1 percent of their operable capacity during the week, up 0.7 percentage points from the prior week. Gasoline production increased, averaging 10.5 million barrels per day, as did the production of distillates, averaging 5.0 million barrels per day.

Crude oil imports rose to an average of 7.6 million barrels per day, up 278,000 barrels per day from the previous week. The 4-week average of crude oil imports declined to 8.0 million barrels per day, 4.3 percent less than in the same period last year.

Domestic crude oil production over the last 4 weeks rose to an average of 10.7 million barrels per day, 14.7 percent above the level produced last year in the same period.

Overall product demand slightly softened, with total product supplied over the last 4 weeks averaging 20.1 million barrels per day, up 1.5 percent from the same period last year. Demand for the main petroleum products also weakened, with motor gasoline supplied averaging 9.4 million barrels per day, up 0.7 percent from the same period last year and distillates supplied averaging 4.2 million barrels per day, up 3.0 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.