Crude oil prices fell again today after the Energy Information Administration reported an increase in crude oil inventories of 4.4 million barrels for the week ending Jan. 15.
This compared to a drop in inventories of 3.2 million barrels estimated by the EIA for the previous week.
In gasoline, the EIA reported a drop in inventories of 300,000 barrels for the week ending Jan. 15, down from 4.4 million barrels the previous week.
Gasoline production averaged 8.9 million bpd last week, up from 7.5 million bpd in the first week of January.
In middle distillates, the EIA reported an increase in inventories of 500,000 barrels for the past week, up from a construction of 4.8 million barrels the week before.
Average middle distillate production stood at 4.5 million bpd during the week of January 15. This against 4.7 million bpd a week earlier.
U.S. refineries processed 14.8 million bpd last week, up from 14.7 million bpd a week earlier. The facilities were operating at an average of 82% of their capacity.
Oil prices have been extremely volatile this week as expectations of a bigger US stimulus package from the Biden administration collided with concerns about the continuation of the pandemic and extended or renewed lockdowns.
The announcement that Iran was increasing oil production in anticipation of the lifting of US sanctions, meanwhile, put strong downward pressure on benchmarks, with Brent and WTI falling more than 1% at time of writing. Reports of new lockdowns in China have added to the pressure. Related: Can Shale Withstand The Allure Of Another Production Surge?
The International Energy Agency earlier this week added fuel to concerns, downgrading its outlook for oil demand for this year to 300,000 bpd. The authority said it expected an average demand of 96.6 million b / d in 2021, after falling from a record high of 8.8 million b / d in 2020 under the weight of the Covid-19 pandemic.
The agency was optimistic for the second half of the year, however, noting that mass vaccination is expected to boost economic recovery, which in turn will raise oil prices. Nothing is certain, however, as the WHO has meanwhile warned that vaccinations are not a silver bullet to the pandemic problem with its chief suggesting that social distancing measures will likely remain in place despite vaccinations.
By Irina Slav for OilUSD
More Most Popular Readings From Oiluka: