US Commercial Crude Inventories Plummet by 9.2 Million Barrels

In a sharp decrease, U.S. commercial crude inventories dropped significantly by 9.2 million barrels for the week ending January 17. This marked a substantial deviation from the previous week's decline of 2.5 million barrels and surpassed expert projections that had forecast a decrease of 2.150 million barrels.

Breakdown of Inventory Changes

As per the detailed weekly figures, commercial crude stocks stood at 420.7 million barrels. Meanwhile, contrasts were notable in other areas as well. Gasoline inventories increased by 4.9 million barrels, in comparison to the 3.1 million increase the week before and outstripped consensus estimates which had anticipated a rise of 2.300 million. In another sector, distillate stockpiles, which include diesel and heating oil, saw a drop of 1.4 million barrels, whereas they had increased by 2.4 million in the previous week. Market expectations had projected a smaller build of 0.348 million.

Another component of the report showed that the Strategic Petroleum Reserve (SPR) experienced a buildup, albeit smaller, with an increase of 0.9 million barrels versus the 0.6 million increment of the last week.

Market Impact

The decline in crude inventory has implications for the futures market and can influence exchange-traded funds (ETFs) linked to the oil sector, such as USO, UCO, SCO, BNO, DBO, and USL. While the decrease in inventories generally points to higher demand or a decrease in production, it can also lead to an uptick in crude prices if the trend persists.

Energy, Inventory, Report