Crude oil prices fell on Wednesday after the Energy Information Administration reported a crude oil inventory draw of 3.5 million barrels for the week to April 2 along with a hefty gasoline stock increase and a build in distillates.
A day earlier, the American Petroleum Institute had estimated a crude oil inventory draw of 2.62 million barrels but a much larger build in gasoline stocks, which put additional pressure on prices already weighed down by soaring Covid-19 infection numbers in several big markets.
In gasoline, the EIA estimated an inventory build of 4 million barrels for the reporting period, compared with a 1.7-million-barrel decline a week earlier. Gasoline production averaged 9.3 million bpd last week, a slight decline on the week before.
In a separate report, the EIA said this week that it expected gasoline consumption during the summer to improve further, after already rising from 7.7 million bpd in January to 8.6 million bpd in March.
In middle distillates, the authority reported an estimated inventory build of 1.5 million barrels for the week to April 2. This compared with a build of 2.5 million barrels for the prior week.
Middle distillate production averaged 4.6 million bpd last week, down from the previous week when output averaged 4.7 million bpd.
Oil prices have been enjoying the effects of economic optimism in the United States, with jobs data for March suggesting hiring is strong, even though it has yet to catch up with pre-pandemic levels of employment, and the economy is on track to post strong growth this quarter and later on in the year.
On the flip side, infection numbers are still on the rise in many parts of the world, including much of the U.S., which is having a negative effect on prices.
At the time of writing, Brent crude was trading at $62.48 a barrel, with West Texas Intermediate at $59.03 a barrel, both slightly down from the opening of trade.
By Irina Slav for Oilprice.com
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Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry.