API: Crude, Product Inventories Continue to Draw

The American Petroleum Institute reported that US crude oil inventories declined by 4.93 million barrels between October 9 and 16. The previous week, crude oil inventories had dropped significantly by 11.12 million barrels. Over the past 27 weeks, commercial crude oil inventories, excluding the Strategic Petroleum Reserve (SPR), have reduced by more than 56 million barrels.

Despite this, US crude inventories currently stand 5 million barrels below their levels at the beginning of the year. The SPR saw a reduction in total inventory to 282.7 million barrels after 300,000 barrels were withdrawn to support commercial inventories. The SPR's current inventory level is still 431 million barrels short of maximum capacity.

The operational minimum for oil in the SPR is between 250-300 million barrels. US crude production for the week ending October 9 was 13.679 million barrels per day (bpd), a decrease from 13.979 million bpd the week prior, yet up 43,000 bpd compared to the same period last year. As of 421 pm ET on October 16, Brent crude was trading down by $0.54% to $108.96 per barrel, marking a decrease of $3 per barrel from this time last week.

West Texas Intermediate (WTI) was also down by $2.75 per barrel or 2.63%, trading at $101.79 per barrel, up roughly $6 from this time last week. Gasoline inventories decreased by 2 million barrels during the week ending October 14, while they rose by 1.1 million barrels in the prior week. According to the latest data from the Energy Information Administration (EIA), gasoline inventories were 4% below the five-year average for this time of year.

Distillate inventories fell by 2.6 million barrels over the week ending October 14, following a 1.5 million barrel decline the week before. Distillate inventories were already 12% below their five-year average heading into this reporting period. Cushing inventory, located at the delivery hub for the WTI Crude futures contract, increased by 900,000 barrels from the previous week's gain of 1.823 million barrels.