EIA: Crude inventories down, more gasoline in storage

Crude oil prices rose initially but then fell on Thursday after the US Energy Information Administration released its weekly inventories report. The new data showed that crude oil stockpiles were down by 2 million barrels in the week ending May 25. A gain of 700,000 barrels in storage had been expected. However, gasoline inventories were up by 1.3 million barrels, about what had been expected. Distillates, including diesel and heating oil, were up but only by 100,000 barrels rather than the 700,000-barrel gain that had been predicted. Refinery utilization was at 91.1 percent, the same as the week before, while analysts had expected usage to go up by 0.6 percent.

By early afternoon trade, West Texas Intermediate crude for July delivery had declined 78 cents to $62.71 per barrel on the New York Mercantile Exchange. Nymex July gasoline was down 3 cents to $2.1535 per gallon. Average at-the-pump prices for gasoline are also lower in the United States, down to $3.191 per gallon according to the Automobile Association of America. Last week, pump prices reached a record high $3.227 per gallon nationwide.

The price declines are very much on a delicate footing, however, as the Atlantic hurricane season begins on Friday, with predictions for 17 named Atlantic storms. Ten of the storms are expected to reach hurricane strength, and three to five of them are predicted to be major storms that could disrupt oil production and refining in the Gulf of Mexico region if they happen to hit the wrong areas.