U.S. petroleum inventories declined modestly, led by drops in crude, gasoline, and distillates, while oil prices remain elevated and volatile amid ongoing geopolitical uncertainty.
Total U.S. petroleum stocks edged down in the week ended April 10 from the previous seven-day period as energy prices remain elevated despite the recent pullback on optimism regarding a potential resolution to the U.S.-Iran conflict.
Modest Drawdown: The Energy Information Administration's (EIA) Weekly Petroleum Status report showed that total petroleum stocks fell to 1.266 billion barrels (bb) from 1.275 billion barrels the previous week.
Commercial crude oil, excluding the Strategic Petroleum Reserves (SPR), saw a 0.9 million barrel (mb) drawdown to 463.8 mb, while economists expected a 2.1 mb build. Despite the drawdown, crude oil inventories were 1% above the five-year average for this time of the year. The SPR stood at 409.2 mb, down 4.1 mb from the previous week.
The EIA noted crude oil imports averaged 6.1 mb/day over the past four weeks, 1.3% less than the four-week period a week earlier.
Motor gasoline inventories fell by 6.3 mb from last week, although they remained 1% above the five-year average, with both finished gasoline and blending component inventories declining. Distillate fuel inventories fell by 3.1 mb and were 6% below the five-year average.
U.S. crude oil refinery inputs averaged 16 mb/d during the week ended April 10, down by 208,000 b/d from the past week. Refineries operated at 89.6% of their operable capacity in the week ended April 10.
Elevated Crude Prices: Following the report, crude oil futures cut their losses and rose more than 1% to above $92. The contract tied to West Texas intermediate (WTI) grade crude oil climbed to a high of $119.48 on March 9, immediately after the onset of the Middle East conflict. Although the futures pulled back from the highs, they saw considerable volatility amid the war headlines.
As of Tuesday, crude futures were down 24% from the early March high, although up 36% from the pre-conflict levels.