US Crude Oil Inventories Drop by 7.2 Million Barrels Amid Middle East Tensions
New government data shows that US commercial crude oil inventories fell by 7.2 million barrels last week, while approximately 3.8 million barrels were withdrawn from the country’s strategic reserves. This decline comes amid renewed tensions in West Asia and disruptions to oil supplies.
According to these figures, US refineries are operating at 97 percent of their production capacity, with some facilities in the Midwest reaching full capacity. Increased production of gasoline, diesel, and jet fuel, alongside rising prices and growing US energy exports to Asian and European markets, are cited as major factors behind the extensive drawdown on reserves.
This trend has coincided with a restriction of oil tanker passage through the Strait of Hormuz following the resumption of US attacks against Iran. The strait is a strategic route through which a significant portion of West Asian oil exports pass.
The Financial Times reports that several analysts have warned that the substantial decline in inventory levels has pushed US crude oil and gasoline reserves below expected thresholds, potentially limiting the country’s ability to serve as the “supplier of last resort” in oil-dependent markets in West Asia, particularly in East Asia and Europe.
Matt Smith, an analyst at Kepler, stated that since the beginning of April, the total US commercial and strategic crude oil reserves have fallen by about 20 percent. Over the past four months, the US has accounted for nearly 70 percent of the total drawdown from global onshore crude oil reserves.
