Oil & Gas

Crude oil prices declined today following the Energy Information Administration's report of a 3.2 million barrel inventory build for the week ending March 22. This contrasts with the previous week's 2 million barrel draw, which was accompanied by a significant draw in gasoline inventories, providing price support. The American Petroleum Institute's inventory report on Tuesday further pushed prices down, estimating a crude oil inventory build of over 9.3 million barrels for the same week.

The EIA's report for the week ending March 22 showed more varied changes in fuels. Gasoline stocks increased by 1.3 million barrels during the reporting period, with production averaging 9.2 million barrels per day (bpd). This is compared to the previous week's 3.3 million barrel draw, with production at a daily average of 9.6 million barrels.

In middle distillates, the EIA estimated a 1.2 million barrel inventory decline for the week ending March 22, with production averaging 4.8 million barrels daily. This contrasts with the previous week's modest inventory build of 600,000 barrels, with production averaging 4.7 million barrels daily.

Despite expectations that OPEC+ will maintain its production policy at its upcoming meeting in early April, oil prices remained low on Wednesday. Analysts suggest that profit-taking and a strong rally in mid-March have contributed to the decline in prices. Additionally, there are indications of a potentially tighter market in the second quarter, as OPEC+ voluntary cuts are extended. However, prices are becoming less reactive to OPEC+ news and more sensitive to indications of tighter supply in the future.