Oil unmoved by crude oil, draws gasoline

Crude oil prices fell slightly after the US Energy Information Administration reported that inventories of the commodity fell in the week to August 23.

Oil inventories fell by 800,000 barrels in the reporting period, compared with a draw of 4.6 million barrels for the previous week.

A week before the EIA report was released, the American Petroleum Institute reported an estimated draw in crude oil inventories to 3.4 million barrels for the week to August 23, largely in line with analysts’ expectations.

For fuels, the EIA estimated mixed changes in inventories.

Gasoline inventories fell by 2.2 million barrels in the week to Aug. 23, with production averaging 9.6 million barrels a day.

That compared with a draw of 1.6 million barrels for the previous week, when gasoline production averaged 9.8 million barrels per day.

For middle distillates, the authority estimated a stockpile increase of 300,000 barrels, with production averaging 5 million barrels per day.

That compared with a 3.3 million barrel drop in inventories for the previous week, when middle distillate production averaged 4.9 million barrels per day.

WTI crude was trading at $74 a barrel after the EIA report, after falling sharply on Tuesday as traders were torn between supply concerns amid the Libyan production shutdown and demand suspicions of lower refining margins.

Libya is shutting down its oil fields amid a dispute between rival political factions. The fields that are closed are all in the east of the country, which is under the control of a government that is not recognized internationally. According to a Reuters report, production of about 1.2 million bpd could be halted.

The geopolitical premium on the price of oil remains in place, with Israel continuing to bomb Gaza and ceasefire talks stalling as Israel turns its missiles to Lebanon to prevent a threatened attack by Hezbollah.

By Irina Slav for Oilprice.com

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