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Energy

Oil Inventories Plummet, Regardless of OPEC Production Targets (USO)

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By Douglas A. McIntyre Updated Published
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Refinery ImageOPEC had noted that it would keep production levels unchanged, but also argued for a $75 ideal oil price.  Whether or not the cartel that does not want to be called a cartel cuts or boosts production, we have just seen our third drop in weekly oil inventories.  The DOE noted that crude oil stocks fell by more than 5.4 million barrels to 363.111 million barrels for the week.  Economists were looking for a drop of 1 million barrels.  Dow Jones had a consensus estimate of roughly -500,000 barrels.

This has acted to support higher oil prices this morning as the United States Oil (NYSE: USO) ETF is up 2% at $35.30 and NYMEX Crude is up $1.00 at $64.45 per barrel.

Gasoline stocks fell less than expected by about 537,000 barrels to a level of just over 203.4 million barrels.

Whether you believe higher rates are coming or not, all the fears of inflation where there when oil was still well under $50.00.  With energy prices getting back up here the fears may start to look more like inevitable events.

The only good news is that we are still entering the summer season with much higher than normal oil inventories.

JON C. OGG
MAY 28, 2009

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About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.

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