According to the U.S. Energy Information Administration (EIA), commercial crude oil reserves climbed by 5.8 million barrels in the week ended April 5, seven times more than the 800,000 barrels expected by analysts, according to a Bloomberg consensus. This unexpected increase comes despite a 2.8% year-on-year decrease in inventories.
Market reaction and economic implications
The news had an impact on oil prices, leading to a slight fall. US West Texas Intermediate (WTI) was down 0.20% at $85.06 a barrel at around 15:00 GMT following the announcement.
Contributing factors and economic context
The increase in inventories can be attributed to several factors. Firstly, a slowdown in US refinery activity was noted, with a utilization rate of 88.3% compared with 88.6% the previous week. In addition, a significant drop in crude oil exports of 32% over the week, reaching an eight-month low, contributed to the rise in inventories.
Demand and production dynamics
Demand for refined products in the United States also declined, as shown by the 9.6% drop in volumes delivered to the US market. In particular, gasoline consumption fell by 6.7% over the week. However, despite these variations, US crude oil production remained stable at 13.1 million barrels per day.
The unexpected rise in US oil inventories highlights the challenges and volatility of the energy market, whose dynamics have profound implications for energy policy and economic planning.
