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EIA Confirms Smaller Than Expected Crude Inventory Draw

Crude oil prices ticked higher today after the U.S. Energy Information Administration reported an inventory decline of 900,000 barrels for the week to December 13.
The number compares with an inventory draw of 4.7 million barrels estimated by the American Petroleum Institute for the same week on Tuesday.
A week ago, the EIA estimated a crude oil inventory draw of a much more moderate 1.4 million barrels, coupled with sizable builds in fuel stocks that dampened the potential bullish effect of the crude inventory move.
For the week to December 13, the EIA estimated mixed changes in gasoline and middle distillate inventories.
Gasoline inventories added 2.3 million barrels during the reporting period, with production at 9.9 million barrels daily.
This compared with an inventory build of 5.1 million barrels for the previous week, when production averaged an estimated 10 million barrels daily.
In middle distillates, the EIA estimated an inventory decline of 3.2 million barrels for the second week of December, with production at an average 5.1 million barrels.
This compared with an inventory build of 3.2 million barrels for the previous week, when production averaged 5.2 million barrels daily.
Oil prices meanwhile were largely unchanged from Tuesday earlier in the day as traders await the Fed’s rate decision. According to a Reuters poll conducted a week ago, the central bank was going to cut rates by another 25 basis points at the December meeting and then keep them unchanged at the next one in January.
“Projections for rate cuts in 2025 are being second-guessed, especially with Trump planning a comeback on January 20,” Phillip Nova analyst Priyanka Sachdeva told Reuters, adding that “There is a prevailing narrative that Trump's policies may lead to inflation, which, coupled with concerns about potential interference with the Federal Reserve's autonomy, is causing oil investors to remain cautious.”
Meanwhile, the latest sanctions announced by the UK and the EU against Russia are believed to limit the downward potential for oil prices but the effect is likely to be short-lived, with the Fed rate decision very much in the spotlight.
By Irina Slav for Oilprice.com
Dec 23, 2024 12:02
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