Oil rises despite rising US crude inventories

Crude oil prices rose today even as the US Energy Information Administration reported an estimated 3.9 million barrel rise in inventories for the week to September 27, driven by the latest escalation in the Middle East.

The stock change was compared with a 4.5 million barrel draw for the previous week, which also saw fuel stockpiles decline.

It also compared with the American Petroleum Institute’s estimate, which pegged the crude stock change for the last week of September at a negative 1.5 million barrels. This was less than analysts expected.

For the final week of September, the EIA estimated mixed changes in gasoline and middle distillate inventories.

Gasoline stocks added 1.1 million barrels during the reporting period, with production averaging 9.6 million barrels per day.

That compared with a drawdown of 1.5 million barrels for the previous week and an average output of 9.8 million barrels per day.

In middle distillates, the authority estimated a decline in stocks of 1.3 million barrels for the last week of September, with production averaging 4.8 million barrels per day.

That compared with a 2.2 million barrel draw in stocks for the previous week, when middle distillate production averaged 4.9 million barrels per day.

In a separate report earlier this week, the EIA reported that U.S. oil demand hit a five-year seasonal high in July, reaching 20.48 million barrels per day. The data is the latest evidence that reports of peak oil demand in 2019 have been grossly exaggerated.

Meanwhile, output fell in July, the EIA reported Monday, suggesting a tighter balance between supply and demand.

Meanwhile, oil prices remained elevated earlier today on news of Iranian missile attacks on Israel and the latter’s vow to retaliate despite calls for restraint and Iran’s statement that the strikes do not mark the start of a larger operation – except the case where there is “subsequent challenge. ” by Tel Aviv, as reported by Reuters.

By Irina Slav for Oilprice.com

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