- Gasoline stockpiles rose for the first time in a month
- WTI futures climbed as much as 5.6% before paring gains
Oil pared gains after the U.S. government reported an unexpected increase in gasoline stockpiles last week.
Futures in New York for July delivery were up 2.8% after earlier rising as much as 5.6%. The U.S. Energy Information Administration showed crude oil inventories declined for the second week in a row and the Cushing, Oklahoma, hub saw a record draw of 5.6 million barrels. But a surprise 2.8 million barrel increase in gasoline stocks reflected ongoing weakness in demand.
“U.S. production is adjusting to the lower demand which is helping to keep inventory levels from reaching the concerns everybody had of reaching capacity,” Rob Thummel, portfolio manager at Tortoise, said in a phone interview. The increase in gasoline inventories is a short-term indicator that demand didn’t rise as much as everyone was expecting last week, he said.
“That would be the only reason why oil would probably give back some of those” gains, he said.