U.S. Oil Stockpile Drop

U.S. crude stockpiles extend drop from highest level in almost two years

American crude and gasoline stockpiles both fell for a third week. The Organization of Petroleum Exporting Countries and its allies agreed to extend output cuts into 2020. Oil is still down for the week after plunging 4.8% on Tuesday, its worst reaction to an OPEC meeting in more than four years. While the group’s Secretary-General Mohammad Barkindo described the drop as an “anomaly,” “Seasonal factors are pushing American stockpiles down, so we have to wait and see if the declines are really driven by strong demand,” said Sungchil Will Yun, a commodities analyst at HI Investment & Futures Corp. in Seoul. “While crude has slumped on weak economic data, a further decline in prices will be limited as we’re likely to see countries putting effort to revive economies and as OPEC is set to keep its supplies under control.” U.S. crude inventories dropped by 1.09 million barrels last week, according to the Energy Information Administration.. Gasoline stockpiles fell by 1.58 million barrels, compared with a forecast for a 2.4 million barrel loss. Oil production also remains near a record high. U.S. domestic output increased to 12.2 million barrels a day last week, resuming gains after dropping since the start of June, the EIA said. Crude exports from the US fell back to below 3 million barrels a day.