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Big Surprise in Crude Oil Stock Draw Sends Prices Higher

by Krystal

Crude oil inventories in the United States decreased by 5.935 million barrels for the week ending November 15, according to the latest data from the American Petroleum Institute (API). This drop far exceeded analysts’ expectations, who had forecasted a modest increase of 250,000 barrels.

In the prior week, the API had reported a 4.753 million barrel increase in inventories. Overall, crude oil stockpiles have fallen by more than 5 million barrels since the start of the year, as per the API’s data.

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Meanwhile, the U.S. Department of Energy (DoE) reported a rise of 1.2 million barrels in the Strategic Petroleum Reserve (SPR) as of November 22. SPR inventories now stand at 390.4 million barrels, about 43 million barrels higher than their lowest point last summer. However, the current stockpile remains 245 million barrels lower than when President Biden took office.

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As of 3:34 pm ET, Brent crude was trading down by $0.41 (-0.56%) at $72.60 per barrel, roughly $0.80 lower than the previous Tuesday. The U.S. benchmark West Texas Intermediate (WTI) also saw a decline of $0.37 (-0.54%), trading at $68.57, down $1 per barrel from the prior week. The drop in prices follows a pullback after last week’s surge, which was triggered by heightened tensions between Ukraine and Russia, as well as a supply disruption at the Johan Sverdrup oil field.

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In terms of refined products, gasoline inventories increased by 1.814 million barrels, reversing last week’s 2.48 million barrel drop. However, gasoline inventories remain 4% below the five-year average for this time of year, according to the latest data from the U.S. Energy Information Administration (EIA).

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Distillate inventories saw a gain of 2.543 million barrels, more than offsetting the 688,000-barrel drop reported the previous week. As of November 15, distillate stocks were also approximately 4% below the five-year average, according to EIA figures.

At Cushing, Oklahoma, the key delivery point for U.S. crude futures, inventories fell by 734,000 barrels, following a decline of 288,000 barrels in the prior week.

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