Crude oil prices ticked higher today, even though the U.S. Energy Information Administration reported an estimated inventory build of 3.9 million barrels for the week to September 27, driven by the latest escalation in the Middle East.
The inventory change compared with a draw of 4.5 million barrels for the previous week, which also saw declines in fuel inventories.
It also compared with the American Petroleum Institute’s estimate, which pegged crude oil inventory change for the final week of September at a negative 1.5 million barrels. This was less than analysts had expected.
For the last week of September, the EIA estimated mixed changes in gasoline and middle distillate inventories.
Gasoline stocks added 1.1 million barrels in the reporting period, with production averaging 9.6 million barrels daily.
This compared with a draw of 1.5 million barrels for the previous week, and production averaging 9.8 million barrels daily.
In middle distillates, the authority estimated an inventory decline of 1.3 million barrels for the final week of September, with production averaging 4.8 million barrels daily.
This compared with a stock draw of 2.2 million barrels for the previous week, when production of middle distillates averaged 4.9 million barrels daily.
In a separate report earlier this week, the EIA reported that U.S. oil demand had hit a five-year seasonal high this July, reaching 20.48 million barrels daily. The data is the latest proof that reports of peak oil demand in 2019 were highly exaggerated.
Production, meanwhile, declined in July, the EIA also reported on Monday, suggesting a tightening balance between supply and demand.
Oil prices, meanwhile, remained elevated earlier today on the news of Iranian missile strikes on Israel and the latter’s vow to retaliate despite calls for restraint and Iran’s statement that the strikes do not mark the beginning of a bigger operation—unless there is “further provocation” by Tel Aviv, as reported by Reuters.
By Irina Slav for Oilprice.com