US Crude Oil Inventories See Surprise Build: API

The American Petroleum Institute (API) reported a surprising increase in U.S. crude oil inventories by 9.072 million barrels during the week ending August 7, surpassing analysts' expectations of a 500,000-barrel draw. This significant build-up marked a sharp contrast to the previous week, when inventories rose by only 2.69 million barrels. The unexpected increase was largely attributed to a higher import rate compared to exports during the week.

Over the past seventeen weeks, commercial crude oil inventories, excluding the Strategic Petroleum Reserve (SPR), have decreased by just over 49 million barrels, with the U.S. crude oil stockpile rising by 1.88 million for the year, according to API data. The recent weekly increase was further fueled by the withdrawal of another 6.1 million barrels from the SPR, bringing the current total to 298.7 million barrels—a level that falls short of the reserve's operational minimum of 250 to 300 million barrels.

U.S. crude oil production for the week ending July 31 increased to 13.804 million barrels per day (bpd), up from 13.796 million bpd in the prior week and 600,000 bpd higher than the same period a year earlier. Brent crude prices were trading up 1.55% to $89.08 per barrel, a nearly $10 increase compared to the previous day, while West Texas Intermediate (WTI) prices climbed by 1.42% to $84.22 per barrel, more than $8 per barrel higher than a week ago.

Gasoline inventories declined by 1.531 million barrels in the week ending August 7, while distillate inventories fell by 596,000 barrels, both figures falling below their respective five-year averages.