EIA’s crude oil report

The EIA (U.S. Energy Information Administration) released its weekly petroleum status report on July 29, 2015. The data showed that US commercial crude oil inventories fell by 4.2 MMbbls (million barrels) to 459.7 MMbbls for the week ending July 24, 2015. In contrast, crude oil stocks rose by 2.5 MMbbls to 463.9 MMbbls for the week ending July 17, 2015.

Surveys from Bloomberg and the Wall Street Journal projected that the crude oil stockpile could rise between 0.85 MMbbls and 2.5 MMbbls for the week ending July 24, 2015. In contrast, a Platt’s survey, Reuter’s surveys, and API data projected that crude oil stocks could fall between 0.7 MMbbls and 1.9 MMbbls over the same period.

Crude Oil Prices Rise for the Second Day, Led by EIA Inventory Data

Impact

The unexpected fall in crude oil inventory, despite the oil glut market, supported crude oil prices. The falling inventory implies that supply is diminishing or demand is rising. The fall in US imports might have led to the fall in the US oil inventory. The US oil imports fell by 396,000 to 7.5 MMbpd for the week ending July 24—compared to the previous week.

The gasoline stockpile fell by 0.4 MMbbls and distillates stocks rose by 2.6 MMbbls for the week ending July 24, 2015. The refinery demand fell by 108,000 bpd (barrels per day) to 16.8 MMbpd (million barrels per day) for the week ending July 24—compared to the previous week. Refinery utilization was at 95.10% of its operable capacity over the same period.

The current US oil stockpile is 25% greater than the level of 367.37 MMbbls last year. It’s also 100 MMbbls above the five-year average. The oil inventories are close to an 80-year high during this period of the year. The record inventories and rising refined product inventories could put downward pressure on crude oil prices.

Crude oil collateral damage impacts oil producers like Murphy Oil (MUR), Marathon Petroleum (MRO), and Hess (HES). They account for 3.40% the Select Sector SPDR Fund ETF (XLE). The volatility in the crude oil market also impacts energy ETFs like the Select Sector SPDR Fund ETF (XLE) and the SPDR S&P Oil & Gas Exploration & Production ETF (XOP).

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