Data released by the U.S. EIA showed that the U.S. commercial crude oil inventories excluding strategic reserves in the week ended September 2 greatly exceeded expectations, while refined oil inventories and gasoline inventories increased slightly. After the EIA data was released, U.S. crude oil prices fell to a short-term bottom of $1 and recovered their losses.
EIA crude oil inventories unexpectedly increased significantly
Specific data shows that the U.S. EIA crude oil inventory changes in the week ended September 2 actually announced 8.844 million barrels, an expected decrease of 250,000 barrels, and a decrease of 3.326 million barrels from the previous value.
In addition, the U.S. EIA gasoline inventories actually announced an increase of 333,000 barrels in the week ended September 2, an expected decrease of 1.66 million barrels and a decrease of 1.172 million barrels from the previous value; the U.S. EIA refined oil inventories actually announced an increase of 95,000 barrels in the week ended September 2. barrels, an increase of 530,000 barrels is expected, and an increase of 111,000 barrels from the previous value.
U.S. crude exports fell by 534,000 bpd last week to 3.433 million bpd, the EIA report showed. U.S. domestic crude oil production was unchanged at 12.100 million barrels per day last week. The four-week average supply of U.S. crude oil products was 20.131 million barrels per day, a decrease of 6.42% from the same period last year. U.S. Strategic Petroleum Reserve (SPR) inventories fell by 7.527 million barrels last week to 442.5 million barrels, or 1.67%.
The EIA report showed that commercial crude oil inventories excluding strategic reserves increased by 8.845 million barrels to 427 million barrels, an increase of 2.11%. Commercial crude oil imports excluding strategic reserves were 6.779 million barrels per day last week, an increase of 823,000 barrels per day from the previous week.
The EIA report showed that the U.S. EIA Strategic Petroleum Reserve inventory in the week to September 2 was the lowest since the week of November 23, 1984. U.S. Gulf of Mexico crude imports rose to their highest level since September 2021. U.S. Midwest refinery operations are at their lowest levels since April 2021. U.S. EIA crude oil inventories for the week to September 2 recorded the largest increase since the week to April 8, 2022.
Analysts commented on the EIA crude oil report that gasoline demand again fell below 2020 seasonal levels, based on a four-week moving average of product supply. That number has remained flat throughout the summer. It has been below 9 million barrels for all but one week since June.
Analysts noted that gasoline inventories on the West Coast fell to their lowest level in more than five years due to a lack of imports. Local refiners have ramped up output, but some plants in Southern California reported some problems this week, possibly related to heating and power issues. Spot gasoline prices have been soaring in San Francisco, Los Angeles and Portland, Ore. An 8.8 million barrel increase in commercial crude inventories was offset by a 7.5 million barrel decrease in strategic oil inventories. The end result was that U.S. crude inventories rose by just 1.3 million barrels in the week to Sept. 2. It was the first increase in national crude inventories in four weeks and the largest increase in two months.