(Bloomberg) – U.S. crude stockpiles declined the most in almost a year last week, signaling a tighter market for American oil just as the Israel-Iran conflict threatens supplies from the Middle East.
Oil inventories dropped 11.5 million barrels in the week through June 13, the steepest slide since late June 2024, according to data released Wednesday by the U.S. Energy Information Administration (EIA). The bulk of the decline came from the U.S. Gulf Coast, a key region that accounts for most U.S. oil exports. Stockpiles there are now the lowest since December 2023.
The drawdown was driven by a combination of rising demand from refiners, who are producing increasing amounts of gasoline as the summer driving season kicks off, as well as a drop in net crude imports.
“Robust exports, lower imports and crude inputs just shy of 17 million barrels per day have conspired to cause a massive draw to U.S. crude inventories,” said Matt Smith, Americas lead oil analyst at market intelligence firm Kpler. “Very modest product builds amid a rebound in implied demand have helped to round out a bullish-tilted report.”
Still, Smith said the market remains focused on the spiraling conflict between Israel and Iran. The confrontation has the potential to reduce exports from Iran, OPEC’s third-biggest producer, as well as impair supplies flowing through the Strait of Hormuz, a vital passageway for global oil supplies.
