U.S. crude oil stocks drop significantly amid rising gasoline inventories

In the United States, crude oil stockpiles experienced a significant decline of 1.8 million barrels for the week ended November 22, according to a recent report from the Energy Information Administration (EIA). This decrease brought total U.S. crude inventories down to 428.4 million barrels, which was notably higher than what analysts had predicted. Expectations for a smaller draw of only 605,000 barrels were established in a Reuters poll. Additionally, the crude stocks at the Cushing, Oklahoma delivery hub, another significant metric for oil pricing, saw a decrease of 909,000 barrels during the same time period. Alongside the decline in crude inventories, gasoline and distillate stocks registered increases. Gasoline inventories, in particular, rose by 3.3 million barrels, reaching a total of 212.2 million barrels, which significantly contrasted the analysts’ predictions for a minor draw of 46,000 barrels. This unexpected build in gasoline inventories led to a slight decrease in U.S. gasoline futures after the data release. Conversely, distillate stockpiles, which include essential fuels such as diesel and heating oil, rose by 400,000 barrels to a total of 114.7 million barrels. This rise in distillate stocks also surpassed the anticipated increase of 100,000 barrels and contributed to a drop in U.S. heating oil futures. The report indicated that refinery activity increased, with crude runs rising by 67,000 barrels per day, pushing utilization rates up by 0.3 percentage points to 90.5 percent of total capacity. Additionally, net U.S. crude imports fell notably by 1.9 million barrels per day to 1.4 million barrels per day, while exports observed a rise of 285,000 barrels per day to reach 4.66 million barrels per day. Overall, the latest inventory numbers suggest fluctuations in the balance between domestic supply and demand within the U.S. oil market, highlighting unexpected increases in gasoline and distillate stocks despite a fall in crude inventories. The change in refinery activity and crude import levels also indicates a potential shift in market dynamics that industry participants will certainly keep an eye on in the upcoming weeks.