Unexpected Drop in U.S. Crude Oil and Gasoline Inventories Exceeds Expectations

The latest data released by the U.S. Energy Information Administration on Wednesday, August 20, revealed significant movements in energy inventories during the week ending August 15, with crude oil and gasoline inventories experiencing a sharp decline that exceeded expectations, while distillate outputs recorded an increase.

In the details of the weekly report, the data indicated a decrease in crude oil inventories by 6 million barrels, bringing the total inventory to 420.7 million barrels. This decline surprised expectations, as analysts participating in a Reuters survey had anticipated a decrease of only 1.8 million barrels.

Contrary to the general trend, crude inventories at the Cushing delivery hub in Oklahoma, which is the delivery point for West Texas Intermediate crude, increased by 419,000 barrels.

On the operational side, the data showed increased activity in refineries, with crude oil consumption at refineries rising by 28,000 barrels per day, and refinery utilization rates increased by 0.2% to reach 96.6% of their operational capacity.

In the petroleum products sector, gasoline inventories recorded a sharp decline of 2.7 million barrels to 223.6 million barrels. This drop also came in higher than analysts' expectations in the Reuters survey, which indicated a projected decrease of 0.9 million barrels.

In contrast, distillate inventories, which include diesel and heating oil, increased by 2.3 million barrels to 116 million barrels, thus exceeding the expected increase of 0.9 million barrels according to the same survey.

The report also showed a decrease in import flows, as net U.S. crude oil imports fell by 1.22 million barrels per day during the past week.