The American Petroleum Institute (API) on Tuesday reported another surprise build in crude oil inventories of 951,000 barrels for the week ending October 1.
This compares to analyst expectations for a loss of 300,000 barrels for the week. It is the second week in a row that estimates were on the wrong side of zero.
In the previous week, the API reported a surprise build in oil inventories of 4.127 million barrels—a market shock considering the 2.333 million barrel draw that analysts had predicted for that week.
Oil prices rose on Tuesday leading up to the data release, with the gas crisis raging on and OPEC+’s Monday decision to keep production plans unchanged instead of increasing production by even more than the 400,000 bpd it had planned for November.
WTI rose 2% on Tuesday afternoon leading up to the data release.
Oil inventories in the United States have drawn down nearly 72 million barrels so far this year, according to API data—well below pre-pandemic levels. The EIA’s latest data suggests that crude oil inventories in the United States are now 7% under the five-year average for this time of year, at 418.5 million barrels.
U.S. oil production has slowly recovered from the wrath of Hurricane Ida, increasing three of the last three weeks. For week ending September 24, U.S. oil production rose 500,000 bpd to 11.1 million bpd—recovering all by 400,000 bpd of what had been lost in the storm.
The API reported a build in gasoline inventories also—again for the second week in a row–of 3.682 million barrels for the week ending October 1—on top of the previous week’s 3.555-million-barrel build.
Distillate stocks saw an increase in inventories of 345,000 barrels for the week, compared to last week’s 2.483-million-barrel increase.
Cushing inventories saw another build as well this week, adding 1.999 million barrels to the total inventory, after last week’s 0.359-million-barrel increase.