EIA crude oil inventories actual -2.032M, below forecast of -1.858M, previous was -2.696M

EIA crude oil inventories actual -2.032M, below forecast of -1.858M, previous was -2.696M

The U.S. Energy Information Administration (EIA) reported that U.S. crude oil inventories fell by 2.032 million barrels, significantly below the forecast of -1.858 million barrels for the week ended May 2, 2025. This marks a notable decrease from the previous week's decline of -2.696 million barrels [2].

The drop in inventories is largely attributed to increased refinery capacity use, which is expected to rise by 0.6 percentage points to 89.2% [2]. This uptick in refinery activity is a key driver of the inventory decline, as refineries ramp up production ahead of the summer driving season. The average estimate from nine analysts and traders predicts a decline in gasoline inventories by 1.5 million barrels to 224 million barrels, extending the current streak of inventory declines to 10 consecutive weeks [2].

The EIA's Short-Term Energy Outlook indicates that global oil production is expected to outpace demand, leading to a buildup in global inventories. The agency forecasts an average crude oil price of $66 per barrel for Brent and $62 per barrel for West Texas Intermediate (WTI) in 2025, down from previous estimates [1]. For 2026, the projections are $59 per barrel for Brent and $55 per barrel for WTI, reflecting the anticipated downward pressure on oil prices.

The accelerated unwinding of OPEC+ output cuts is further contributing to the downward pressure on oil prices. Although OPEC+ members plan to raise production in June, the EIA anticipates that the group will still produce below the current target path [1].

The inventory data, scheduled for release by the EIA on Wednesday, May 7, 2025, at 10:30 a.m. EDT, provides valuable insights into the current state of the oil market and the broader energy sector.

References:
[1] https://www.tradingview.com/news/DJN_DN20250506009070:0-eia-cuts-oil-price-estimates-on-expected-inventory-builds/
[2] https://www.tradingview.com/news/DJN_DN20250506008593:0-analysts-see-decline-in-u-s-crude-oil-inventories/