Crude oil suffered 12% this month on demand worries, unexpected surge in stocks as reported by EIA
Oil, which was worse hit sector by global growth concern, tumbled about 6% yesterday, after EIA’s Weekly Inventory Status Report showed surprise gains, first time in 8-week, in the crude oil stocks by 2.4 million barrels from the previous week while expectations were for little over 6mb drop and a week ago inventory declined by 8.5mb. At 438.9 million barrels, U.S. crude oil inventories are about 2% above the 5-year average for this time of year.
Gasoline inventories increased by 4.4 million barrels last week, 4% above the 5-year average for this time of year and Distillate fuel inventories increased by 1.5 million barrels last week, about 1% below the 5-year average for same period.
Refineries in the U.S. operated at 96.4% of their operable capacity last week.
Gasoline production increased to 10.4 million barrels per day last week while, Distillate fuel production increased to 5.3 million barrels per day.
US Crude oil production continued to stay at record high at 12.3mbpd.
Fresh sanctions on Venezuela by the US failed to halt price drop in oil.
EIA’s Short-term Energy Outlook(STEO), August report showed U.S. crude oil production will average 12.3 million b/d in 2019 and 13.3 million b/d in 2020, both of which would be record levels.
Looking forward, $61 will act as formidable resistance while, immediate support is at $50/barrel if that is taken out will take the prices towards $45/$42.5.
Story by Tarun Satsangi for www.tarunsatsangi.com