A surprise build in commercial crude stocks and a massive Cushing surge are complicating an already messy supply picture for oil markets.
US commercial crude oil inventories climbed by 1.786 million barrels for the week ending September 18, according to preliminary data from the American Petroleum Institute. Analysts had expected a draw of roughly 500,000 barrels, making the actual number a swing of more than 2 million barrels from consensus.
The miss was notable on its own, but the real eyebrow-raiser came from Cushing, Oklahoma, the key delivery hub for West Texas Intermediate futures. Cushing inventories surged by 2.082 million barrels in a single week, completely reversing the prior week’s modest 246,000-barrel decline and then some.
A tale of two inventory reports
Gasoline stocks dropped by 2.16 million barrels during the same period. Distillate inventories, which cover diesel and heating oil, fell by a nearly identical 2.164 million barrels.
The SPR keeps shrinking
The government drew down an additional 400,000 barrels, pushing total SPR holdings to 284.6 million barrels. That’s the lowest level since the early 1980s, a period when the reserve was still being filled for the first time.
Over the prior 22 to 23 weeks, commercial crude inventories (excluding the SPR) have seen cumulative draws of roughly 39 to 41 million barrels. This week’s build interrupts that pattern, at least temporarily.
