Oil prices rose on Wednesday morning, despite a somewhat surprising EIA inventory report, reflecting an increase in crude stocks and virtually unchanged petrol stocks
The price of crude oil rose today after the Energy Information Administration reported a stockpile of crude oil of 1.3 million barrels for the week to 19 February. The build was much lower than those estimated by the API a day earlier.
The report comes a day after the US Petroleum Institute estimated an oil supply buildup of more than 1 million barrels. It also compared analysts’ expectations that a draw of 5.372 million barrels for the reported week and a stocktaking of 7.3 million barrels were reported according to the EIA for the previous week.
Petrol inventories remained surprisingly virtually unchanged in the week to February 19, following a modest build of 700,000 barrels for the previous week, despite the disruption of the refinement of operations by the Texas Freeze.
Gasoline production declined last week due to the shutdown of the Texas refinery, to 7.7 million bpd. This compared to an average production rate of 9 million bpd during the previous week.
In distillates, the EIA reported a 5.0 million barrel decline in inventories for the week of the Texas Freeze. Middle distillate stocks remain above seasonal averages, but are declining gradually, currently at 3 percent above the five-year average.
Distillate production averaged 3.6 million bpd last week, compared to 4.6 million bpd the previous week.
The events in Texas last week are likely to keep oil prices higher for some time as production starts slowly again, and some of them may not return at all as companies turn uneconomic, marginal wells, despite WTI prices of more as $ 60 per barrel.
Rising bullish sentiment among banks and traders has also recently contributed to higher oil prices, especially after Goldman said he expects prices to reach $ 70 and reach it by the summer. Demand recovery is driving this sentiment, and production disruptions in the United States have only contributed to further strengthening it.
At the time of writing, Brent crude was trading at $ 66.61 a barrel, with West Texas Intermediate at $ 62.76 a barrel.
By Irina Slave for Oilprice.com
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