Investing.com -- U.S. crude stocks fell almost 6 million barrels last week, losing all that they added the prior week, a government report showed on Wednesday as global oil inventories turned volatile from persistent Saudi attempts to squeeze a market at a crossroads due to the sluggish economy in top importer China.
U.S. oil production was, meanwhile, projected at a new three-year high of 12.7M barrels per day during the week to Aug. 11 in the Weekly Petroleum Status Report of the Energy Information Administration, or EIA.
In the prior week to Aug. 4, the EIA estimated crude production at 12.6M. Prior to these two weeks, the agency had not projected such a high number for output, following the record 13.1M barrels produced daily before the coronavirus outbreak in March 2020.
Crude stockpiles fell by 5.960M barrels during the week ended Aug. 11, after the build of 5.851M in the prior week to Aug. 4, the EIA said. Industry analysts tracked by Investing.com had forecast a decline of just 2.32M for last week.
The EIA’s reporting on crude stockpiles has turned volatile in recent weeks, with the agency citing a record draw of 17.049M barrels two weeks ago, as global stockpiles see shifts from a Saudi bid to cut an additional million barrels per day from their shipment while Chinese buying slows.
A closer examination of the EIA weekly report showed last week’s crude draw possibly result from a spike in U.S. crude exports, which rose to 4.599M barrels from a prior 2.36M.
On the gasoline inventory front, there was a draw of 0.261M after the prior week’s 2.661M slide. Analysts had forecast a draw of as much as 1.26M for last week.
While automotive fuel gasoline is the No. 1 U.S. fuel product, demand for it has been lackadaisical this summer, with draws often coming below analysts' calls and weekly builds sometimes registered in the place of draws.
With distillate stockpiles, there was a surprise build of 0.296M versus a forecast draw of 0.473M and the prior week’s decline of 1.706M. Distillates are refined into heating oil, diesel for trucks, buses, trains and ships, and fuel for jets.