Oil: U.S. stocks down 6M barrels, output at new 3-year high

investing.com:

Investing.com — U.S. crude stocks fell by just over six million barrels last week, more than double the level forecast. But output of oil in the largest producing country hit new three-year highs, a government report showed on Wednesday, as supply-demand of the commodity remained volatile from persistent Saudi attempts to squeeze a market at a crossroads due to the sluggish economy in top importing nation China.

U.S. gasoline inventories registered a surprise build last week against expectations for a drop, while the growth in distillates was four times more than forecast, the Energy Information Administration, or EIA, said in its Weekly Petroleum Status Report.

Crude stockpiles fell by 6.135M barrels during the week ended Aug. 18, following through with the 5.960M decline in the prior week to Aug. 11, the EIA said. Industry analysts tracked by Investing.com had forecast a drop of just 2.850M for last week.

But on the gasoline inventory front, the EIA reported a build of 1.467M barrels, after a slide of 0.261M barrels last week. Analysts had forecast a decline of 0.888M for last week. Automotive fuel gasoline is the No. 1 U.S. fuel product.

With distillate stockpiles, the expectation was for a climb of 0.945M barrels versus the prior week’s gain of 0.296M. Analysts had predicted a build of just 0.218M for last week. Distillates are refined into heating oil, diesel for trucks, buses, trains and ships, and fuel for jets.

The EIA’s reports on oil and fuel inventories have turned volatile lately as global stockpiles see shifts from Saudi and Russian maneuvers to slash exports amid slower buying from China.

Inventory levels aside, the EIA report was noteworthy for the new three-year high estimates that it made for U.S. oil