The price of US light crude oil surged today after the Energy Information Administration (EIA) published its weekly petroleum status report, which showed big declines in inventories of products refined from crude oil.
By late in the New York pit-traded session, US light crude oil futures had risen by 1.9% to $95.20 a barrel. The December crude oil contract closed yesterday at its lowest price since the beginning of June.
US stockpiles of crude increased by 1.6 million barrels last week, rising for the seventh week in a row, with domestic production still at high levels, but it is the dropping level of gasoline and other refined products that has got the market’s attention.
Inventories of gasoline plunged 3.8 million barrels, after a draw of 1.7 million in the previous week, while distillate supplies were reduced to the tune of 4.9 million barrels. A drop of just 400,000 barrels for gasoline had been forecast.
Gasoline consumption is up, rising to 9.29 million barrels, the highest level since early July, which was back in the middle of the peak driving season. The rise in demand has come as a response to dropping gasoline prices, with the average gasoline price having fallen to its lowest level this year.