Oil prices supported by crude inventory drawdown

The American Petroleum Institute (API) on Tuesday reported a drop in crude oil inventories of 2.533 million barrels for the week ending May 7.

Analysts predicted a draw 2.817 million barrels for the week.

In the previous week, API reported a massive 7.688 million barrel oil inventory draw after analysts predicted a 2.346 million barrels draw. Since the start of 2020, crude oil inventories have increased by more than 50 million barrels, according to API data.

Oil prices rose the day before the data was released, with OPEC’s oil demand forecast remaining unchanged in the latest edition of its MMOR and Colonial pipeline outages forcing Gulf Coast refiners to curb production.

As of 3:23 p.m. EDT, WTI was trading at $ 65.47, 0.85% higher on the day and about $ 0.20 lower per barrel than last week. Brent traded at $ 68.72 a barrel or 0.59% higher on the day.

As crude oil inventories fell this week, U.S. oil production remained unchanged at 10.9 million bpd on average for the week ending April 30, according to the latest data from the Energy Information Administration.

The API reported an increase in gasoline inventories of 5.640 million barrels for the week ending May 7 – more than offsetting the 5.308 million barrel draw the week before. Analysts expected a 600,000 barrels draw for the week.

Distillate inventories saw their inventories decline this week by 872,000 barrels for the week, following a drop of 3.453 barrels last week.

Cushing inventories fell 1,209 barrels this week.

After the data was released at 4:35 p.m. EDT, the benchmark WTI was trading at $ 65.41 while Brent was trading at $ 68.67 a barrel.

By Julianne Geiger for OilUSD

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