Crude Price Tumbles as Gasoline Stockpile Booms

Total gasoline inventories increased by 2.4 million barrels last week and remain in the middle of the five-year average range. Total motor gasoline supplied (the EIA’s measure of consumption) averaged about 9 million barrels a day for the past four weeks, up by 0.1%, compared with the same period a year ago.

Distillate inventories increased by 4.1 million barrels last week, but remain below the lower limit of the average range. Distillate product supplied averaged more than 3.7 million barrels a day over the past four weeks, up by 1.5% when compared with the same period last year. Distillate production averaged 5.1 million barrels a day last week, flat with prior week’s production.

Wednesday evening, the American Petroleum Institute (API) reported that crude inventories fell by 1.9 million barrels in the week ending September 5, together with a rise of 719,000 barrels in gasoline supplies and an increase of 1.7 million barrels in distillate supplies. For the same period, analysts surveyed by Reuters estimated a decrease of 1.1 million barrels in crude inventories, a decrease of 200,000 barrels in gasoline inventories and a rise of 600,000 barrels in distillate inventories.

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Before the EIA report, West Texas Intermediate (WTI) crude was trading down at around $92.10 a barrel, about 0.7% below Wednesday’s closing price of $92.74. The WTI price slipped to around $91.60 a barrel shortly after the report was released.

For the past week, crude imports averaged over 7.6 million barrels a day, down by about 54,000 barrels a day over the previous week. Refineries were running at 93.9% of capacity, with daily input of more than 16.3 million barrels a day, about 96,000 barrels a day below the previous week’s average.

WTI crude prices have slipped from about $95 a barrel a week ago to below $92 a barrel. The inventory decrease Tuesday is less than expected and will put even more pressure on crude prices. Combined with lower demand now that summer is over, pump prices should continue to decline. Also Tuesday, OPEC cut its demand growth forecast for both this year and next.

According to AAA, the current national average pump price per gallon of regular gasoline is $3.428, down from $3.433 a week ago and from $3.478 a month ago. Last year a gallon of regular cost $3.564 on average in the United States.

Here is a look at how share prices at three U.S. producers reacted to this latest report.

Exxon Mobil Corp. (NYSE: XOM) traded down about 1.4%, at $96.09 in a 52-week range of $84.79 to $104.76.

Chevron Corp. (NYSE: CVX) traded down about 1.6%, at $123.12 in a 52-week range of $109.27 to $135.10.

Continental Resources Inc. (NYSE: CLR) traded down about 1.9% to $147.29. The stock’s 52-week range is $99.74 to $161.82. Continental is the largest producer in the Bakken Shale play and reported softer than expected results Tuesday morning.

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