The American Petroleum Institute (API) estimated on Tuesday a huge crude oil inventory build of 11.938 million barrels for the week ending April 4 as demand destruction stemming from the coronavirus wears on.
Today’s inventory move was expected to be for a large build of 9.27 million barrels.
In the previous week, the API estimated a large build in crude oil inventories of 10.485 million barrels, while the EIA’s estimates were even more bearish, reporting a build of 13.8 million barrels for the week.
Oil prices were trading sharply down on Tuesday afternoon prior to the API’s data release.
At 4:02 pm EDT on Tuesday the WTI benchmark was trading down on the day by $1.65 (-6.33%) at $24.43, although it is still up $4 per barrel week over week. The price of a Brent barrel was also trading down on Tuesday, by $0.70 (-2.12%), at $32.35—up by roughly $6 week on week. The higher prices over last week was due mainly to optimism that OPEC+ could reach a production cut deal and bring other states on board the cuts as well.
The API reported a large build of 9.445 million barrels of gasoline for week ending April 4, after last week’s 6.085-million-barrel build. This week’s build compares to analyst expectations for a 4.333-million-barrel build for the week.
Distillate inventories were down, by 177,000 barrels for the week, compared to last week’s 4.458-million-barrel draw, while Cushing inventories saw a large gain of 6.804 million barrels.
US crude oil production as estimated by the Energy Information Administration showed that production for the week ending March 27 was unchanged at 13.0 million bpd.
At 4:36 pm EDT, WTI was trading at $24.05 while Brent was trading at $32.04.