Crude oil inventories in the United States fell dramatically by 7.4 million barrels for the week ending August 30, according to the American Petroleum Institute (API). Analysts had predicted a much smaller decline of 900,000 barrels.
The previous week, the API had reported a decrease of 3.4 million barrels in crude inventories. Year-to-date, inventories are down more than 2 million barrels from the start of the year, with a total drop of 10 million barrels, based on API data.
The Department of Energy (DoE) reported on Tuesday that inventories in the Strategic Petroleum Reserve (SPR) increased by 1.8 million barrels as of August 30, reaching a total of 379.7 million barrels.
Oil prices continued to fall on Wednesday, ahead of the API data release. As of 4:09 p.m. ET, Brent crude was trading down $1.37 (-1.86%) at $72.38, marking a total loss of over $7 per barrel since the previous Tuesday. This decline comes amid disappointing economic data from the U.S. and China. The U.S. benchmark WTI also saw a decrease of $1.48 (-2.10%) to $68.84, down nearly $7 per barrel from last Tuesday.
Gasoline inventories also decreased this week by 300,000 barrels, following a 1.86-million-barrel drop the previous week. Current gasoline inventories are 3% below the five-year average for this time of year, according to the latest Energy Information Administration (EIA) data.
Distillate inventories fell by 400,000 barrels, adding to last week’s 1.4-million-barrel decrease. Distillate levels are approximately 10% below the five-year average for the week ending August 23, based on the latest EIA data.
Cushing inventories saw an 800,000-barrel draw, according to API data, which builds on the 486,000-barrel draw from the previous week.