Crude oil futures fell for the second day in a row on Wednesday (May 18) following reports that U.S. refiners were ramping up production to cope with a sharp drop in inventories. The decline paralleled the U.S. stock market, which fell sharply on concerns about the inflation crisis.
- WTI crude futures were down $2.81, or 2.5%, at $109.59 a barrel.
- BRENT crude futures were down $2.82, or 2.5%, at $109.11 a barrel.
Crude oil futures fell after reports that U.S. refiners are ramping up oil production to cope with a sharp drop in fuel supplies. Refining capacity on the East Coast and Gulf Coast is now above 95%, indicating that refineries are approaching their maximum capacity.
According to the EIA, U.S. crude oil inventories declined by 3.4 million barrels last week. Crude oil inventories at Cushing, Oklahoma, the delivery point for U.S. crude oil futures, fell by 2.4 million barrels and gasoline inventories fell by 4.8 million barrels.
Investors are eager to see progress on reports that the U.S. will ease energy sanctions on Venezuela to pave the way for negotiations between the government and the U.S.-backed opposition
The discussions include allowing Chevron Corp to negotiate directly with PDVSA, Venezuela’s national oil company.
Venezuela, a member of the Organization of Petroleum Exporting Countries (OPEC), has seen its lowest oil exports in decades due to U.S. sanctions on PDVSA.
The Spot Market is Open
Thursday, May 19, 2022