Crude oil and refined product futures contracts were all seeing strong gains Wednesday afternoon following the release of a bearish inventory and demand report by the Energy Information Administration.

Crude oil was up by about $1/bbl as prices seemed on track to end a four-day streak of sharp losses.

The September contract for West Texas Intermediate crude was $1.03 higher at about 12:30 p.m. ET to $77.97/bbl while October prices advanced by 99cts to $76.91/bbl. Brent crude was seeing similar gains, with the September contract rising $1.01 to $82.02/bbl and October prices gaining $1.02 to $81.09/bbl.

Gains for refined products were in the 4cts/gal range, with August RBOB adding 4.06cts to $2.4547/gal while September prices were 4.11cts in the black to $2.4168/gal. The front-month ULSD contract increased by 4.23cts to $2.4522/gal while September prices added 4.25cts to 42.4696/gal.

Energy prices had started the day with gains, but those increases accelerated following the release of EIA's weekly Petroleum Status Report.

EIA reported U.S. crude oil inventories fell by 3.7 million bbl in the week ending Friday, placing stocks 5% below the seasonal five-year average.

Gasoline inventories fell by 5.6 million bbl while distillate supplies were 2.8 million bbl lower. Gasoline inventories are now 2% below seasonal averages while distillate supplies are facing a deficit of 9%.

The decline in supplies came as EIA reported a solid increase of nearly 700,000 b/d in implied U.S. gasoline demand. At 9.456 million b/d, implied demand was at the highest level this year and above that in the comparable weeks of 2022 and 2023.

The drop in oil inventories came as U.S. refinery utilization pulled back to average 91.6%. The decrease had been expected amid weak refining margins and lackluster gasoline demand so far this summer.

Oil inventories shrank even as U.S. oil production continues at record levels this summer, averaging 13.3 million b/d during the week.


This content was created by Oil Price Information Service, which is operated by Dow Jones & Co. OPIS is run independently from Dow Jones Newswires and The Wall Street Journal.


--Reporting by Steve Cronin, scronin@opisnet.com; Editing by Michael Kelly, mkelly@opisnet.com


(END) Dow Jones Newswires

07-24-24 1318ET