US: EIA Petroleum Status Report

Wed Jun 06 09:30:00 CDT 2018

Actual Previous
Crude oil inventories (weekly change) 2.1M barrels -3.6M barrels
Gasoline (weekly change) 4.6M barrels 0.5M barrels
Distillates (weekly change) 2.2M barrels 0.6M barrels

Crude oil inventories rose 2.1 million barrels in the June 1 week to 436.6 million, 14.9 percent below their level a year ago. Product inventories also increased, with gasoline up 4.6 million barrels to 239.0 million, 0.5 percent below last year at this time and distillates up 2.2 million barrels to 116.8 million, 22.7 percent lower year-on-year. The build in crude oil inventories contrasted with a 2.0 million decrease reported Tuesday by the American Petroleum Institute, a private industry group. WTI prices fell about 80 cents to around $64.60 per barrel immediately following the release of the EIA report.

Refineries ramped up to operate at 95.4 percent of their operable capacity, up 1.5 percentage points from the prior week. Gasoline production nevertheless decreased, averaging about 9.7 million barrels per day, while the production of distillates did increase slightly, averaging about 5.3 million barrels per day.

Crude oil imports rose to an average of 8.3 million barrels per day, up 715,000 barrels per day from the previous week. Over the last 4 weeks, crude oil imports averaged 7.9 million barrels per day, 4.4 percent less than in the same period last year.

Domestic crude oil production over the last 4 weeks averaged 10.8 million barrels per day, 15.4 percent more than in the comparable period last year.

Overall product demand is weakening, with total products supplied over the last 4 weeks averaging 20.1 million barrels per day, only 0.2 percent above the level in the same period a year ago. Demand for the main products continues to soften, with gasoline supplied averaging 9.5 million barrels per day, down 1.1 percent from the same period last year, while supplied distillates averaged 3.9 million barrels per day, down 2.6 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.