|Crude oil inventories (weekly change)||-2.4M barrels||0.9M barrels|
|Gasoline (weekly change)||-4.0M barrels||-5.5M barrels|
|Distillates (weekly change)||-0.3M barrels||-5.2M barrels|
Crude oil inventories fell 2.4 million barrels in the October 27 week to 454.9 million, 5.7 percent below the level a year ago. Product inventories also fell, with gasoline down 4.0 million barrels to 212.8 million, 4.9 percent below last year’s level, and distillates down 0.3 million barrels to 128.9 million, a sharp 14.4 percent year-on-year drop. After rising to above 55 dollars per barrel, a two-year high, driven partly by Tuesday’s report from the American Petroleum Institute, a private industry, informing of an even larger 5.87 million barrel decline in crude stocks for the week, WTI prices fell back about 40 cents to around $54.60 immediately following the release of today’s EIA report.
The Energy Information Administration (EIA) provides weekly information on petroleum inventories in the U.S., whether produced here or abroad. The level of inventories helps determine prices for petroleum products.
Petroleum product prices are determined by supply and demand – just like any other good and service. During periods of strong economic growth, one would expect demand to be robust. If inventories are low, this will lead to increases in crude oil prices – or price increases for a wide variety of petroleum products such as gasoline or heating oil. If inventories are high and rising in a period of strong demand, prices may not need to increase at all, or as much. During a period of sluggish economic activity, demand for crude oil may not be as strong. If inventories are rising, this may push down oil prices.
Crude oil is an important commodity in the global market. Prices fluctuate depending on supply and demand conditions in the world. Since oil is such an important part of the economy, it can also help determine the direction of inflation. In the U.S., consumer prices have moderated whenever oil prices have fallen, but have accelerated when oil prices have risen.