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US commercial crude inventories (excluding SPR) rose 0.1 million barrels to 428.9 million barrels in the week ended August 21, compared with analysts’ expectations in a Reuters poll for a 597,000-barrel rise.

Crude imports fell 435,000 barrels a day to 6.2 million, while exports dropped 274,000 barrels a day, a rare instance of both sides of the crude trade retreating in tandem rather than offsetting one another. Because imports fell faster than exports, net imports tightened by roughly 161,000 barrels a day on the week, a squeeze that argues the import decline was the dominant force behind the flat inventory print rather than any pickup in outbound flows. Domestic production edged up 13,000 barrels a day, a modest gain that did little to backfill the import shortfall and left the barely positive inventory print looking more like a wash than a genuine cushion build.

Motor gasoline told a tighter story as total inventories fell 2.5 million barrels, extending a stretch of steady draws that has pushed stocks to 6% below the five-year average heading into the tail end of summer demand season.

Taken together, the data point to a crude market where trade flows are contracting on both ends, likely a symptom of the Hormuz-related disruptions still working through global supply chains, while gasoline continues to draw down faster than the broader crude balance would suggest is comfortable.

Written by: Farid Muzaffar