Key facts
- US crude oil inventories rose by 4.2 million barrels in the week ending August 21, exceeding analyst expectations.
- The Strategic Petroleum Reserve (SPR) drew down by 3.7 million barrels, reaching 289.7 million barrels.
- SPR levels are approaching a potential operational minimum of 250-300 million barrels.
- US crude production increased to 13.830 million bpd.
- Gasoline and distillate inventories also saw decreases.
US crude oil inventories saw an unexpected build of 4.2 million barrels in the week ending August 21, according to estimates from the American Petroleum Institute (API). This figure surpassed the 1.9 million barrel increase analysts had predicted. Concurrently, the Strategic Petroleum Reserve (SPR) continued its drawdown, releasing another 3.7 million barrels, bringing its total holdings to 289.7 million barrels.
This level is approaching the generally accepted operational minimum for the SPR, which ranges between 250-300 million barrels, below which efficient pumping and processing of oil may become challenging. Commercial crude inventories, excluding the SPR, have decreased by over 45 million barrels in the past nineteen weeks, though US crude inventories are up 5.8 million barrels for the year, largely due to the SPR draws.
US crude production saw a slight increase to 13.830 million barrels per day for the week ending August 14. Meanwhile, gasoline inventories fell by 3.2 million barrels and distillate inventories decreased by 500,000 barrels. The key delivery hub for WTI futures, Cushing, Oklahoma, experienced a 1 million barrel increase in inventory.
In commodity markets, Brent crude was trading down 4.11% at $88.38 per barrel, and WTI crude was down 3.39% at $82.13 per barrel on Tuesday afternoon.