U.S. Crude Oil Rallies as Inventories Drop 8.6 Million Barrels
U.S. crude oil futures advanced as domestic commercial oil inventories fell by 8.6 million barrels in the week ended October 9. The reduction marked the largest weekly drop since February and lowered stockpiles excluding the Strategic Petroleum Reserve to 415.6 million barrels, 3% below the five-year average. Nymex crude for November delivery rose 3% to settle at $97.97 per barrel, marking its sixth consecutive session of gains.
The sharp inventory drop stemmed from heavy refinery demand and shut-ins caused by Hurricane Isaias. Gasoline supplies expanded by 3.5 million barrels to 208.3 million barrels, while distillate fuel stocks declined by 2.5 million barrels to 102.6 million barrels. Meanwhile, proposed U.S. policy changes to lift sanctions on shadow fleet tankers are projected to yield minimal extra shipping capacity due to vessel age, foreign sanctions, and lack of standard maritime insurance.
Traders are watching further supply actions and shipping developments across key trade routes. Member countries of the International Energy Agency are accelerating emergency oil releases, including diesel supplies. Although a tanker sank following a strike near the Strait of Hormuz, vessel traffic through the waterway remains active.
Key points
- U.S. crude stockpiles dropped by 8.6 million barrels to 415.6 million barrels, the largest weekly decline since February.
- Nymex crude futures gained 3% to $97.97 per barrel, reaching their highest close since September 18.
- Gasoline stocks grew by 3.5 million barrels, while distillate fuel inventories fell by 2.5 million barrels.
- Proposal to ease sanctions on shadow fleet tankers is expected to return only about 24 supertankers to active trade.
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How we writeDisclaimerQuestions and answers
Why did U.S. crude oil prices rise?
U.S. crude prices rose following an 8.6 million barrel drop in inventories, driven by strong refinery runs and hurricane-related production shut-ins.
How much did U.S. crude inventories fall?
U.S. commercial crude stockpiles declined by 8.6 million barrels to 415.6 million barrels, reaching 3% below the five-year average.
Will easing tanker sanctions lower oil costs?
Lifting sanctions is expected to have limited effect because aging shadow fleet ships lack insurance and certification for mainstream trade.