Oct. 31 (UPI) — Crude oil future prices turned around Wednesday immediately after the Energy Information Administration issued a weekly report showing drawdowns in diesel and gasoline, as well as a smaller-than-anticipated oil inventory build.
At around 9:49 a.m. EDT, West Texas Intermediate front-month crude futures traded at $65.86 per barrel, or down 0.5 percent, while Brent front-month traded at $75.55 per barrel, also 0.5 percent lower.
By 10:37 a.m., immediately after the Energy Information Administration, or EIA, distributed its weekly report, prices had turned. West Texas Intermediate front-month traded at $66.29 per barrel, or 0.2 percent higher. Brent futures traded at $76.16 per barrel, or 0.3 percent higher.
“Crude oil futures rose in the wake of the latest EIA report, whereby the headline figure showed a build of 3.217mln barrels, which was less than analyst expectations and also less than yesterday’s API figure (5.69mln barrels),” DailyFX analyst Justin McQueen told UPI.
“Alongside this, there were sizeable drawdowns in the distillate and gasoline inventories, providing further support for prices. However, it remains to be seen whether this report will be strong enough to instigate a change in the negative sentiment for the oil complex,” he added.
On Wednesday morning, the Energy Information Administration’s report said inventories are about 2 percent above the five-year average for this time of the year, citing data as of Oct. 26.
At 426 million barrels, U.S. crude oil inventories are about 2 percent above the five-year average for this time of the year, it said.
Total motor gasoline inventories decreased by 3.2 million barrels last week and are about 6 percent above the five-year average for this time of year. Distillate fuel inventories decreased by 4.1 million barrels last week and are about 5 percent below the five-year average for this time of year. Distillates refer to diesel.
The U.S. is both a major consumer and producer of crude oil and crude oil products worldwide, and its inventory levels affect prices.
BP also said Wednesday it has completed the $10.5 billion acquisition of BHP’s U.S. unconventional assets. The acquisition, announced in July and closed as scheduled Wednesday, adds oil and gas production of 190,000 barrels of oil equivalent per day, it said.