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US Crude Oil Inventories Fell for the Seventh Consecutive Week

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EIA’s crude oil inventories  

The EIA (U.S. Energy Information Administration) released its weekly crude oil report on May 24, 2017. It reported that US crude oil inventories fell by 4.4 MMbbls (million barrels) to 516.3 MMbbls on May 12–19, 2017. US crude oil inventories fell 0.8% for the week ending May 19, 2017—compared to the previous week. However, crude oil inventories have risen 2.1% year-over-year. Crude oil prices fell despite a larger-than-expected fall in US crude oil inventories on May 24, 2017. For more on crude oil prices, read Part 1 and Part 2 in this series.

On May 23, 2017, the API (American Petroleum Institute) reported that US crude oil inventories fell by 1.5 MMbbls between May 12, 2017, and May 19, 2017. A survey estimated that inventories would have fallen by 2.4 MMbbls for the same period.

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Inventories fell for the seventh consecutive week for the week ending May 19, 2017. They fell by 19 MMbbls in the last seven weeks. As a result, US crude oil (SCO) (BNO) (VDE) futures rose 4.4% in the last four weeks. Higher crude oil prices have a positive impact on oil and gas producers like Warren Resources (WRES), Chevron (CVX), Hess (HES), and QEP Resources (QEP).

US crude oil inventories by region

The EIA divides the US into five storage regions. Let’s assess the changes in crude oil inventories on May 12–19, 2017.

  • East Coast – flat at 16.8 MMbbls
  • Midwest – fell by 1.8 MMbbls to 159.2 MMbbls
  • Gulf Coast – fell by 2.1 MMbbls to 260.4 MMbbls
  • Rocky Mountain – fell by 0.5 MMbbls to 24.2 MMbbls
  • West Coast – flat at 55.7 MMbbls

Impact of US crude oil inventories

US crude oil inventories are 3.5% below their peak level. Near-record inventories could weigh on crude oil prices.

We’ll take a look at US crude oil output in the next part of the series.

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