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Oil Stockpile Dropped by 1.662 Million Barrels Last Week: EIA

U.S. oil stockpiles declined by slightly more than expected in the latest week, the Energy Information Administration said on Wednesday.

Crude oil inventories fell 1.662 million barrels last week, compared with analysts' expectations for a draw of 1.05 million barrels.

Distillate stockpiles, which include diesel and heating oil, fell 3.013 million barrels in the week against expectations for a draw of 1.9 million barrels, the EIA data showed.

Refinery crude runs were 123,000 barrels. The weekly refinery utilization rate rose 0.7%, according to the EIA report.

Gasoline inventories fell 1.745 million barrels last week the EIA said, compared with expectations for a draw of 614,000 barrels.

“It’s not surprising to have larger-than-expected drawdowns across the board in a week just before Memorial Day,” said analyst Barani Krishnan.
“Yet, WTI and Brent are barely higher at the time of writing, probably due to reports that Iran’s production sans U.S. sanctions — whenever that comes — will make an impact on OPEC. That it takes Russia to remind its OPEC allies about that shows the level of inordinate disregard OPEC has for Iran, no thanks to the Saudis who are at the helm of the cartel.”
Krishnan noted the average daily drop of 138,000 barrels in U.S. crude imports that helped the overall decline of 1.66 million barrels.

“U.S. crude exports helped too, though not by much, with a marginal increase to 3.43 million barrels daily from the previous week’s 3.31 million,” he said.
“The bottomline is, it’s a solid draw ahead of Memorial Day, where Americans are expected to fill up their tanks at least more than once this week for road trips stretching over the three-day long break into next week.”
The American Automobile Association expects as many as 37 million road travelers on this Memorial Day, up 60% from last year’s pandemic-suppressed 23 million travelers.
“Next week’s EIA numbers will give some sort of idea on how close we are to those numbers, though a better reflection will come in the next two weeks,” Krishnan added.