Key facts
- US crude oil inventories dropped by 9.119 million barrels in the week ending June 5, significantly more than the expected 3.4 million barrel draw.
- Gasoline inventories also fell by 1.191 million barrels.
- Strategic Petroleum Reserve (SPR) inventories decreased by 7.9 million barrels, reaching their lowest level since August 2023.
- US crude production saw a slight decrease to 13.707 million bpd.
- Despite inventory declines, both Brent and WTI crude oil prices were trading lower.
- OECD oil stockpiles are forecast to drop to levels not seen in decades.
Despite a significant drop in US crude oil inventories, exceeding analyst expectations, and a decrease in gasoline stocks, crude oil prices continued to decline. The American Petroleum Institute reported a 9.119 million barrel decrease in crude inventories for the week ending June 5, while gasoline inventories fell by 1.191 million barrels.
Inventories in the Strategic Petroleum Reserve (SPR) also saw a substantial reduction of 7.9 million barrels, bringing them to the lowest level since August 2023. US crude production experienced a slight dip to 13.707 million barrels per day. Concurrently, the EIA cautioned that OECD oil stockpiles are projected to fall below 2.3 billion barrels, a level not seen in decades.
However, these bearish inventory signals did not translate into higher prices. Brent crude was trading down 3.03% at $91.39 per barrel, and WTI crude fell 3.48% to $88.12 per barrel. Gasoline inventories were already 6% below the five-year average, while distillate inventories were 11% below the five-year average prior to this week's data.