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Today’s weekly inventory reports from the Department of Energy (DoE) showed larger than expected declines in both crude oil and gasoline stockpiles. Since it’s been awhile since we last updated our charts of current inventories relative to expectations, we wanted to update them below. In the case of crude oil, stockpiles declined by 5.247 million barrels versus expectations for a decline of just 2 million barrels. This week’s decline was also the largest weekly decline of the year. Looking at how inventories stack up relative to historical averages, current levels are still well above average and even above where they were at this time last year. What is important to note, though, is that inventory levels peaked at the end of March when they normally don’t peak until right about now. If the seasonal decline in stockpiles that normally begins in early May started a month early this year, that could help to support prices going forward.
In terms of gasoline stockpiles, this week’s report showed a modest drawdown of 150K barrels compared to expectations for an increase of 300K. As shown in the chart, current inventory levels are pretty much right in line with where they were a year ago at this time and have been following the pattern of last year pretty closely. Relative to the long-term average going back to 1990, this year’s pattern has also been following the seasonal script, albeit from a much higher base.