The Energy Information Administration, the statistical division of the US Energy Department, today published its weekly petroleum status report, which showed a rise in the overall size of crude oil inventories, but another decline at the important oil hub of Cushing Oklahoma, the price settlement point for US crude oil futures.
The stockpile at Cushing dropped to 35.9 million barrels, reaching its lowest level since last October. Supplies at Cushing have fallen close to 6 million barrels in just the last three weeks, with the glut at Cushing being seriously eaten into now that the southern leg of the Keystone XL pipeline has begun shifting crude out to refineries along the Gulf Coast to the tune of 288,000 barrels a day, a rate of flow that is set to increase as the year goes on, moving up toward the line’s maximum 700,000-barrel capacity.
Crude inventories as a whole rose for a fifth successive week, increasing by 973,000 barrels to 362.3 million. This was well below expectations though, with a Bloomberg survey of analysts forecasting an increase of 2.25 million barrels. Refinery utilisation remained at 87.0% of capacity.
The improvements in the transport network out of Cushing and the lower-than-expected overall rise in crude supplies should be generally supportive for the US crude price, and the price of crude did pop up to $103 a barrel in the wake of the report’s release, but the price has already risen so fast since the middle of January that even with support from the fundamentals, buyers may be cautious.
By mid-afternoon in New York, crude oil futures for April were trading at $102.55, down 0.37% after hitting a high earlier in the trading session of $103.30, the highest price seen in the most liquid contract since October last year.