Crude Oil Price Slips as Inventory Declines Continue

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The U.S. Energy Information Administration (EIA) released its weekly petroleum status report Wednesday morning. U.S. commercial crude inventories decreased by 4.9 million barrels last week, maintaining a total U.S. commercial crude inventory of 463 million barrels. The commercial crude inventory remains near levels not seen at this time of year in at least the past 80 years.

Tuesday evening, the American Petroleum Institute (API) reported that crude inventories fell by 3.2 million barrels and gasoline inventories also declined by 2.9 million barrels in the week ending June 19. For the same period, analysts estimated a decrease of 2.1 million barrels in crude inventories.

Total gasoline inventories increased by 700,000 barrels last week, according to the EIA, and remain in the upper half of the five-year average range. Total motor gasoline supplied (the agency’s measure of consumption) averaged about 9.4 million barrels a day for the past four weeks, up by 4.5% compared with the same period a year ago.

The increase in gasoline inventories is working to lower the prices that consumers pay at the pump. Crude oil exports have doubled from 273,000 barrels a day a year ago to 571,000 barrels a day last week, and net exports of petroleum products totaled 3.74 million barrels a day, compared with 3.12 million a year ago. Total products supplied reached 20.68 million barrels a day, up nearly 2 million barrels a day year-over-year. U.S. producers are still working through high crude inventories and refineries continue to benefit.

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Before the EIA report, West Texas Intermediate (WTI) crude for August delivery traded up about 0.5% at around $61.30 a barrel. The WTI price tumbled to around $60.80 (down about 0.3% for the day) immediately after the report was released. The 52-week range on WTI futures is $48.61 to $96.72.

Distillate inventories increased by 1.8 million barrels last week and have moved back into the middle of the average range for this time of year. Distillate product supplied averaged over 3.8 million barrels a day over the past four weeks, down by 0.9% when compared with the same period last year. Distillate production averaged less than 5 million barrels a day last week, down about 100,000 barrels a day compared with the prior week’s production.

For the past week, crude imports averaged about 6.8 million barrels a day, down by 302,000 barrels a day compared with the previous week. Refineries were running at 94% of capacity, with daily input of over 16.5 million barrels, about 250,000 barrels a day above the previous week’s average.

According to AAA, the current national average pump price per gallon of regular gasoline is $2.779, down from $2.802 a week ago but up from $2.738 a month ago. Last year at this time, a gallon of regular cost $3.681 on average in the United States.

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Here is a look at how share prices for two blue-chip stocks and two exchange traded funds reacted to this latest report.

Exxon Mobil Corp. (NYSE: XOM) traded up about 0.2% to $85.22, in a 52-week range of $82.68 to $104.76. Year to date, Exxon stock traded down about 7.8%, and it is down about 11.8% since early November, as of Tuesday’s close.

Chevron Corp. (NYSE: CVX) traded up about 0.4% to $100.49, in a 52-week range of $98.81 to $135.10. As of the most recent close, Chevron shares have also dropped about 10.3% year to date and trade down about 16.1% since early November.

The United States Oil ETF (NYSEMKT: USO) traded up about 0.1%, at $20.49 in a 52-week range of $15.61 to $39.32.

The Market Vectors Oil Services ETF (NYSEMKT: OIH) traded down about 0.5%, at $35.72 in a 52-week range of $31.51 to $58.01.