The American Petroleum Institute (API) has reported an increase in U.S. crude oil inventories, impacting global oil prices. In the week ending April 3, U.S. crude stockpiles rose by 3.719 million barrels, following an increase of 10.263 million barrels in the previous week. This surge defied analyst expectations, which had predicted a draw of 1.598 million barrels.
U.S. Strategic Petroleum Reserve Updates
For the second consecutive week, the U.S. Strategic Petroleum Reserve (SPR) saw a reduction in barrels. During the week ending April 3, 1.8 million barrels were withdrawn from the SPR, reducing its total to 413.3 million barrels. Historically, this is 312.2 million barrels short of its maximum capacity.
Current Production Levels
According to the latest data from the Energy Information Administration (EIA), U.S. oil production remained steady at 13.657 million barrels per day (bpd) for the week ending March 27. This figure represents a decrease of 78,000 barrels over the past five weeks but is still higher by 77,000 bpd compared to the same period last year.
Market Reaction
As of 4:24 PM ET, shortly before the data release, Brent crude was trading at $109.20, down 0.56% for the day but up $5 per barrel compared to the previous week. The decline in tanker traffic through the Strait of Hormuz, alongside oil production disruptions in Iraq, the UAE, and Saudi Arabia, continues to exert upward pressure on prices.
West Texas Intermediate (WTI) also experienced a slight decrease of $0.29 (-0.26%), trading at $112.10. However, this figure reflects a week-over-week increase of $10 per barrel.
Product Inventories Decline
- Gasoline inventories decreased by 4 million barrels in the week ending April 3, following a 3.209 million barrel drop the week prior.
- Despite this decrease, gasoline inventories are currently 4% above the five-year average for this time of year.
- Distillate inventories also fell, down 600,000 barrels after a 1.04 million barrel decline the previous week, and currently 3% below the five-year average.
- Cushing inventory, which is critical for WTI futures, slipped by 600,000 barrels after an increase of 784,000 barrels the week before.
The persistent shifts in U.S. crude oil stocks and product inventories are influencing global supply dynamics and pricing as markets adapt to ongoing volatility.
