US Crude Oil Inventories See Massive Drop Off

The American Petroleum Institute (API) estimated that crude oil inventories in the United States fell by a massive 11.12 million barrels in the week ending October 9. In the week prior, US crude oil inventories fell by 2.09 million barrels.Commercial crude oil inventories excluding the SPR have lost more than 51 million barrels over the last 26 weeks, but US crude inventories are at roughly the same level as they were at the beginning of the year, according to API data, kept in check in part thanks to draws from the SPR.For the week ending October 9, no barrels left the SPR to aid commercial inventories, keeping the total inventory held in the SPR at 283 million barrels—a level that is still 431 million barrels shy of maximum capacity.The generally accepted operational minimum for oil in the SPR is between 250-300 million barrels, below which the reserve may find it difficult to pump and process oil efficiently.US production for the week ending Oct 2 rose to 13.979 million bpd, up from 13.955 in the week prior, and up 350,000 bpd from a year earlier.At 4:39 pm ET on Wednesday, Brent crude was trading up on the day at $106.02 (-0.12%). Brent is trading up $5 per barrel from this time last week.WTI was trading up on the day by $0.93 per barrel (+0.98%) at $95.75, which is up nearly $6 per barrel since this time last week. Gasoline inventories rose by 1.1 million during the week ending October 7. In the week prior, gasoline inventories fell 1.37 million barrels. In the week prior, gasoline inventories were 6% below the five-year average for this time of year, according to the latest EIA data.Distillate inventories fell 1.5 million barrels after rising 461,000 barrels in the week prior. Distillate inventories were 12% below the five-year average heading into this reporting period, the latest EIA data shows.Cushing inventory—the inventory kept at the delivery hub for the WTI Crude futures contract—gained 1.823 million after gaining 866,000 barrels in the previous week.By Julianne Geiger for Oilprice.comMore Top Reads From Oilprice.comRussian Strikes Cut Power to 600,000 Ukrainians Days After U.S. Diesel DealIndia’s Gas Demand Drops as Iran War Hikes LNG Spot PricesChina's Coal Imports Fall 6% as Prices Hit Nearly 3-Year High