Oil prices rose on Wednesday morning, despite a somewhat surprising EIA inventory report, reflecting an increase in crude oil and gasoline stocks virtually unchanged.
Crude oil prices rose today after the Energy Information Administration reported an increase in crude oil inventory of 1.3 million barrels for the week to February 19.
The report came a day after the American Petroleum Institute estimated an oil stock of more than 1 million barrels. It also compared analysts’ expectations of an extraction of 5.372 million barrels for the reported week and an inventory of 7.3 million barrels extracted from the EIA reported for the previous week.
Surprisingly, gasoline stocks remained virtually unchanged in the week to February 19, after a modest 700,000 barrel construction for the previous week, despite disruptions to Texas Freeze refining operations.
Gasoline production fell last week as a result of the Texas refinery shutdown to 7.7 million bpd. This was compared to an average production rate of 9 million bpd in the previous week.
In distillates, the EIA reported a 5.0 million barrel drop in stocks for Texas Frost Week. Average distillate stocks remain above seasonal averages, but are steadily declining, currently at 3% compared to the five-year average.
Distillate production averaged 3.6 million bpd last week, compared to 4.6 million bpd last week.
Last week’s events in Texas are likely to keep oil prices higher for a while as production slowly restarts, and some of them may not return at all as companies leave uneconomical and marginal wells, despite WTI prices of over $ 60 a barrel.
Rising sentiment among banks and traders has also contributed to rising oil prices recently, especially after Goldman said it expected prices to reach $ 70 and exceed them by the summer. The recovery in demand is driving this sentiment, and production interruptions in the United States have only helped to strengthen it.
At the time of writing, Brent crude was trading at $ 66.61 a barrel and West Texas Intermediate at $ 62.76 a barrel.
By Irina Slav for Oilprice.com
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