Crude oil prices have risen today after the Energy Information Administration reported that inventories had dropped 7.2 million barrels between the week and August 27th.
This compares with a draw of 3 million barrels of crude inventory estimated by the EIA for the previous week and analysts ’expectations for a draw of 2.83 million barrels.
A day before the EIA report, the American Petroleum Institute estimated an oil inventory of more than 4 million barrels, which was larger than expected.
Just as the OPEC + meeting in Vienna begins, the US energy authority estimated that gasoline stocks had added 1.3 million barrels during the week to August 27, with an average production of 9.9 million bpd during the period.
This was compared to an inventory of 2.2 million barrels a week earlier and an average production of 10.2 million barrels per day.
Stocks of medium distillates recorded a draw of 1.7 million barrels in the reporting period, with an average production of 4.8 million barrels per day.
One week earlier, the EIA estimated an average distillate stock production of a modest 600,000 barrels and an average production of 5 million barrels per day.
Despite rising gasoline production, pump prices have also risen, prompting President Biden last month to ask OPEC to add more supply to global oil markets.
The most recent price jump, however, was the result of the devastation caused by Hurricane Ida in the Gulf of Mexico oil industry and the Gulf Coast, with some key ports still closed, with likely reopening weeks later.
The chances of this really happening are slim. It seems that OPEC does not believe that the market needs more oil right now. In fact, the joint technical committee of the enlarged cartel estimated in a recent report that the oil market would go into a surplus next May, with a surplus of about 1.6 million barrels per day, from a current deficit of 900,000 per barrel.
By Irina Slav for Oilprice.com
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