Crude oil prices fell slightly today after the U.S. Energy Information Administration reported an inventory decline of 5.2 million barrels for the week to December 2.
This compared with a sizeable draw of 12.6 million barrels estimated for the previous week, which sent prices higher at the time.
A day before the EIA released its report, the American Petroleum Institute estimated another weekly crude inventory draw for the week to December 2, at 6.43 million barrels.
Meanwhile, the EIA also reported an inventory build in gasoline and another rise in middle distillate stocks for the week to December 2.
Gasoline inventories added 5.3 barrels in the week to December 2, with production averaging 9.1 million barrels daily.
This compared with a build of 2.8 million barrels for the previous week and a production rate of 9.4 million barrels daily.
In middle distillates, the EIA estimated an inventory build of 6.2 million barrels for last week, with production at 5.3 million barrels daily.
This compared with an inventory increase of 3.5 million barrels and a production rate of 5.3 million bpd for the previous week.
Oil prices, meanwhile, are slipping further down as traders relax about the potential consequences of the G7 and EU price cap on Russian oil. It appears they have assumed that it would not affect the availability of oil in any significant way and are selling crude, with both Brent and WTI slipping below $80 per barrel.
Analysts also note that Russian oil is already trading close to the cap, so it shouldn’t make much of a difference in revenues but it is worth remembering Russia has said it would not sell oil to countries that enforce the price cap, meaning supply of Russian oil specifically might tighten for some importers.
Russia has also threatened to set a price floor for its oil in response to the G7 price cap, which may further complicate matters.