On Wednesday, September 10, the U.S. Energy Information Administration (EIA) reported that U.S. crude oil and fuel inventories increased last week due to declining exports and demand.
The EIA reported that U.S. commercial crude oil inventories increased by 3.9 million barrels to 424.6 million barrels in the week ending September 5, compared with analysts' expectations for a decrease of 1 million barrels.
The EIA reported that crude oil inventories at the Cushing, Oklahoma delivery hub fell by 365,000 barrels last week.
U.S. crude oil exports fell by 1.1 million barrels per day to 2.8 million barrels per day, while net crude oil imports increased by 668,000 barrels per day.
Kpler analyst Matt Smith said, "The sharp decline in exports and the slight decrease in refining activity contributed to the sizable increase in crude oil inventories. Gasoline and distillate inventories both increased amidst weakening implied demand."
Crude oil futures pared gains following the unexpected increase in inventories. Refinery crude oil runs fell by 51,000 barrels per day (bpd) last week, while capacity utilization rose 0.6 percentage points to 94.9%.
Total product supplies, representing demand, fell by 871,000 bpd to 19.8 million bpd. Gasoline consumption fell by 609,000 bpd to 8.5 million bpd, while distillate supplies fell by 391,000 bpd to 3.4 million bpd.
He added that given recent economic data, particularly signs of a slowdown in the labor market, weak gasoline demand and low export patterns could be further evidence of a slowdown in the U.S. economy and potentially the global economy.
The EIA said gasoline inventories rose by 1.5 million barrels last week to 220 million barrels, compared with expectations for a draw of 243,000 barrels. Distillate fuel inventories, which include diesel and heating oil, rose by 4.7 million barrels to 120.6 million barrels, compared with expectations for a 35,000-barrel increase.
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