U.S. Crude Stocks Edge Lower as Oil Tops $100

The American Petroleum Institute reported a decline of 300,000 barrels in U.S. crude oil inventories during the week ending September 4. This marks a reversal from the previous week's drop of 2.6 million barrels. Commercial crude oil reserves, excluding the Strategic Petroleum Reserve (SPR), have experienced a loss of nearly 48 million barrels over the past 21 weeks, with overall U.S. crude inventories increasing by 2.8 million barrels year-to-date, according to API data.

On September 4, 1.2 million barrels were released from the SPR to bolster commercial inventories, bringing the total SPR inventory to 285.4 million barrels, which is 446 million barrels below its maximum capacity.

The SPR's operational minimum is generally considered to be between 250-300 million barrels, and falling below this range could make it challenging to efficiently pump and process oil. The week ending August 28 saw an increase in U.S. production to 13.862 million barrels per day (bpd), up from 13.843 bpd the previous week and an increase of 423,000 bpd compared to the previous year.

As of 3:16 PM ET on Wednesday, Brent crude was trading at $101.46, up 3.62% for the day, marking a nearly $6 per barrel gain from the previous week. West Texas Intermediate (WTI) also saw a price increase of $3.41, or 3.67%, bringing the price to $96.44, a nearly $6 per barrel increase from a month ago.

Meanwhile, gasoline inventories declined by 1.9 million barrels during the week ending September 4, compared to a 300,000 barrel rise in the prior week. Gasoline inventories were already 6% below the five-year average for this time of year, according to the latest Energy Information Administration (EIA) data. Distillate inventories, on the other hand, increased by 2 million barrels in the week ending September 4, contrasting with the 300,000 barrel loss in the previous week.

Distillate inventories were also 14% below the five-year average at the start of this reporting period, as per the latest EIA data. Lastly, the inventory at the Cushing delivery hub, which stores WTI Crude futures contract inventories, fell by 300,000 barrels over the reporting period after rising by 200,000 barrels the week prior.