Sharp Inventory Drawdowns
Investors have pinned hopes of recovery over the U.S. Energy Department’s inventory releases that show multiple weeks of strong inventory draws in the domestic crude stockpiles – pointing to a slowdown in shale output. Oil stockpiles have shrunk in 27 of the last 35 weeks and are down more than 85 million barrels since April.
The gradual fall has helped the U.S. crude market shift from year-over-year storage surplus to a deficit. At 448.1 million barrels, current crude supplies are 7.8% below the year-ago period though they are in the upper half of the average range during this time of the year.