Oil Inventories Unexpectedly Increase by 0.6M Barrels Last Week: API

By Yasin Ebrahim

U.S. crude oil inventories saw an unexpected increase last week, according to a report released on Tuesday. Meanwhile, gasoline stocks fell, raising concerns about rising gas prices just days before the onset of the U.S. driving season, when many Americans embark on vacation road trips.

The U.S. benchmark crude was trading at $110.52 per barrel after a previous settlement of $109.77 per barrel, which marked a decrease of 52 cents.

For the week ending May 19, crude inventories rose by 567,000 barrels. This marked a significant shift from the previous week’s reported draw of 2.4 million barrels, with economists having anticipated a decreased inventory of around 690,000 barrels.

Additionally, the data indicated that gasoline inventories dropped by 4.2 million barrels, and distillate stocks fell by approximately 949,000 barrels.

This decline in gasoline stocks occurs just as fuel demand is expected to surge with the impending summer driving season, which unofficially kicks off with Memorial Day at the end of May. Recent data revealed that the average price of gasoline at U.S. pumps reached a new high of $4.59 per gallon.

The official government inventory report expected to be released on Wednesday is projected to show a reduction of around 737,000 barrels in U.S. crude oil inventories for the past week.