The U.S. Energy Information Administration (EIA) released its inventory report on Wednesday, August 20, showing a sharp drop in U.S. crude oil inventories last week as imports declined while exports jumped.

U.S. commercial crude oil inventories fell by 6 million barrels to 420.7 million barrels in the week ending August 15, compared to market expectations for a 1.8 million-barrel decrease.

U.S. crude oil inventories at the Cushing, OHIO hub increased by 419,000 barrels during the week.

Following the report, international crude oil futures continued to trade above the positive level. At 1452 GMT, Brent crude futures rose 58 cents to $66.37 per barrel, while WTI crude futures rose 48 cents to $62.08 per barrel.

U.S. net crude oil imports fell by 1.218 million barrels per day to 2.125 million barrels per day, compared to the four-week average of 2.887 million barrels per day.

U.S. crude oil exports increased by 795,000 barrels per day (bpd) to 4.372 million bpd, compared to a four-week average of 3.491 million bpd.

U.S. crude oil imports decreased by 423,000 bpd to 6.497 million bpd, compared to a four-week average of 6.379 million bpd.

John Kilduff, an analyst at Again Capital, said that U.S. crude oil exports remained strong, leading to robust crude oil demand. Furthermore, U.S. refinery demand for crude oil processing was also relatively strong, contributing to a bullish weekly crude oil inventory report.

U.S. refinery capacity utilization increased by 0.2 percentage points to 96.6% during the week.

U.S. refinery crude oil processing increased by 28,000 bpd to 17.208 million bpd, compared to a four-week average of 17.106 million bpd.

U.S. gasoline inventories fell by 2.7 million barrels to 223.6 million barrels during the week, compared to market expectations for a 900,000-barrel decrease.

U.S. distillate fuel inventories, including diesel and heating oil, rose by 2.3 million barrels to 116.0 million barrels during the week, compared to market expectations for a 900,000-barrel increase.

U.S. domestic crude oil production increased by 55,000 barrels per day to 13.382 million barrels per day, compared to the four-week average of 13.327 million barrels per day.

UBS analyst Giovanni Staunovo said in a note that today's EIA weekly crude oil inventory report was very positive, as U.S. commercial crude oil inventories fell sharply due to increased exports and decreased imports. This also suggests that U.S. oil demand remains strong, leading to a significant drop in U.S. gasoline inventories during the week.

U.S. refined fuel supplies increased to 21.5 million barrels per day during the week, up 149,000 barrels per day from the previous week.

The four-week average of U.S. jet fuel consumption rose to its highest level since 2019 during the week.

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