Crude Oil Price Rises on Falling Gasoline Inventories

Energy

Published: October 29, 2014 11:15 am

Last Updated: April 27, 2020 7:48 pm

The U.S. Energy Information Administration (EIA) released its weekly petroleum status report Wednesday morning. U.S. commercial crude inventories increased by 2.1 million barrels last week, maintaining a total U.S. commercial crude inventory to 379.7 million barrels. Crude inventory is now near the top of the five-year range for this time of the year.

Total gasoline inventories decreased by 1.2 million barrels last week and are now in the lower half of the five-year average range. Total motor gasoline supplied (the EIA’s measure of consumption) averaged 8.8 million barrels a day for the past four weeks, down by 1.1% compared with the same period a year ago.

Distillate inventories decreased by 5.3 million barrels last week and are near the lower limit of the average range. Distillate product supplied averaged about 3.6 million barrels a day over the past four weeks, down by 4% when compared with the same period last year. Distillate production averaged 4.5 million barrels a day last week, about 100,000 barrels per day below the prior week’s production.

Tuesday evening, the American Petroleum Institute (API) reported that crude inventories rose by 3.2 million barrels in the week ending October 24, together with a decline of 3.7 million barrels in gasoline supplies and a decline of 3 million barrels in distillate supplies. For the same period, analysts polled by Platts had estimated an increase of 2.8 million barrels in crude inventories, a drop of 1.7 million barrels in the gasoline supply and a decline of 1.5 million barrels in distillate inventories.

Before the EIA report, West Texas Intermediate (WTI) crude was trading up about 0.8% at around $82.10 a barrel. The WTI price bounced higher to around $82.50 immediately after the report was released.

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For the past week, crude imports averaged over 7.1 million barrels a day, down about 376,000 barrels a day compared with the previous week. Refineries were running at 86.6% of capacity, with daily input of about 15.1 million barrels a day, about 100,000 barrels a day below the previous week’s average.

WTI crude prices had been gaining strength the past few days after bouncing off lows below $79 a barrel. The reported drop in gasoline supplies should boost crude prices a bit more Wednesday.

According to AAA, the current national average pump price per gallon of regular gasoline is $3.086, down from $3.177 a week ago and from $3.338 a month ago. Last year a gallon of regular cost $3.344 on average in the United States.

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

The United States Oil ETF (NYSEMKT: USO) traded up about 1.4%, at $31.23 in a 52-week range of $30.16 to $39.44.

The Market Vectors Oil Services ETF (NYSEMKT: OIH) traded up about 1.1%, at $45.08 in a 52-week range of $40.98 to $58.01.

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