The US saw a significant drop in crude oil stockpiles, totaling 8 million barrels, exceeding analysts' forecasts significantly. Meanwhile, export levels surged to unprecedented heights and refining operations reached an impressive 94.7% utilization rate.
US crude stockpiles fell significantly last week due to robust exports and heightened refining activity, which met the needs of several Asian and European nations seeking alternative energy sources after disruptions from the ongoing four-month Iran conflict.
Related ↗British companies halt recruitment amid Iran conflict impact, REC research indicates.The US crude stockpiles dropped by 8 million barrels to 433.7 million barrels as of May 29, according to the EIA's latest data, exceeding the predicted 4 million-barrel decrease forecasted by analysts.
Crude oil shipments soared to a record-breaking 5.9 million barrels daily, resulting in a significant reduction of 6.7 million barrels in Gulf Coast stockpiles.
Read next ↗Tate & Lyle accepts a £2.7 billion all-cash acquisition from Ingredion.Cushing, Oklahoma's USOICC-ECI storage hub saw a significant drop in crude stocks, plummeting by 583,000 barrels to reach 22.4 million barrels within a week.
The US Strategic Petroleum Reserve has now dipped to its lowest level since January 2024, with an 8-million-barrel decrease. This reduction is part of the ongoing release of 172 million barrels from the reserve to mitigate rising crude prices and stabilize the market.
Crude inventory levels have plummeted by 63.9 million barrels following the February 28 U.S.-Israeli strikes on Iran.
Kpler's Director of Commodity Research Matt Smith noted that SPR barrels have been steadily depleted, with an additional 8 million barrels removed from inventories last week. Meanwhile, commercial inventories received a substantial influx of barrels, yet still absorbed a net total of 16 million barrels in crude.
The weekly net import of US crude oil dropped significantly by 249,000 barrels per day.
Refinery utilization rates surged to 94.7% after a 0.2 percentage point increase, but refinery crude runs dropped by 90,000 barrels daily, according to the EIA's latest report.
Oil prices surged further after the report was released, with Brent crude futures trading at $97.93 per barrel, up by $1.93 from earlier levels, as of 11:45 a.m. ET (1545 GMT). US West Texas Intermediate futures also climbed to $95.89 a barrel, increasing by $2.11.
Refinery processing surged, while weak demand following the Memorial Day holiday contributed to an uptick in fuel inventories nationwide.
According to the EIA's latest data, USOILG=ECI gasoline stocks increased by 3.4 million barrels, reaching a total of 215 million barrels as of the current week. This surge exceeded analysts' forecasts, which had predicted a 0.5 million-barrel decrease.
According to the EIA data, US distillate stockpiles, comprising diesel and heating oil, increased significantly by 1.5 million barrels in one week, reaching 102.3 million barrels, contrary to forecasts of a 0.3 million-barrel decrease.
Analyst Giovanni Staunovo of UBS notes a less optimistic outlook for refined products, citing unexpected inventory builds of gasoline, distillate, and jet fuel following the Memorial Day holiday. This trend may soon shift as product demand is expected to rise in the upcoming weeks.
Demand indicators plummeted as total product supplied dropped by 610,000 barrels daily to 20.33 million bpd.
Refinery utilization rates surged to 94.7%after a 0.2 percentage point increase, but refinery crude runs dropped by 90,000 barrels daily, according to the EIA's latest report.
According to the EIA data,US distillate stockpiles, comprising diesel and heating oil, increased significantly by 1.5 million barrels in one week, reaching 102.3 million barrels, contrary to forecasts of a 0.3 million-barrel decrease.
