EIA crude oil inventories unexpectedly declined, refined oil inventories were basically flat, and U.S. oil fell by $0.3 in the short term

On Wednesday (October 19) in the New York session, at 22:30 Beijing time, data released by the US EIA showed that the US commercial crude oil inventories excluding strategic reserves unexpectedly fell less than expected in the week ending October 14, and refined oil inventories and gasoline inventories were basically flat
.
U.
S.
crude oil prices fell by $
0.
3 in the short term after the EIA data.

EIA crude oil inventories were unexpectedly lower than expected

Specific data show that the actual change in EIA crude oil inventories in the United States for the week ended October 14 decreased by 1.
725 million barrels, expected to increase by 138 barrels, and the previous value increased by 9.
88 million barrels
.

In addition, the actual decrease in EIA gasoline inventories in the United States for the week ended October 14 was 114,000 barrels versus an expected decrease of 1.
114 million barrels, the previous value was 2.
023 million barrels, the actual increase in EIA refined oil inventories in the United States for the week ended October 14 was 124,000 barrels, and the expected decrease was 2.
167 million barrels; and the previous value decreased by 4.
853 million barrels
.

The EIA report showed that the United States imported 5.
908 million b/d of commercial crude oil excluding strategic reserves in the week of Oct.
14, down 155,000 b/d
from the previous week.
Commercial crude inventories, excluding strategic reserves, fell by 1.
725 million barrels, or 0.
39%,
to 437 million barrels.

The EIA report showed that U.
S.
domestic crude oil production rose by 100,000 barrels per day to 12 million barrels per day
in the week of October 14.
U.
S.
crude exports rose 1.
266 million b/d to 4.
138 million b/d
in the week of Oct.
14.
U.
S.
Strategic Petroleum Reserve (SPR) inventories fell by 3.
564 million barrels, or 0.
87%,
to 405.
1 million barrels in the week of Oct.
14.
The four-week average supply of U.
S.
crude oil products was 20.
408 million b/d, down 2.
38%
from a year earlier.

The EIA report showed that U.
S.
EIA Strategic Petroleum Reserve inventories for the week ending Oct.
14 were the lowest
since the week of June 1, 1984.

US crude oil price 5-minute chart displays

Fears of a recession triggered by Fed rate hikes weighed on oil prices

Signs emerge that the Fed's aggressive rate hike path may begin to suppress the labor market, which is bound to affect personal consumption expenditures
.
The Fed's policy path has many investors worried that it could tip the economy into recession
by making policy mistakes and raising interest rates excessively.
Regarding the need for the Fed to curb inflation, Fed officials have largely been unanimous
in their comments.
Ratings agency Fitch has cut its U.
S.
economic growth forecast for this year and next, warning that Fed rate hikes and inflation will tip the economy into a 1990-style recession
, a report said.

JPMorgan strategists said this week that they are cutting their long delivery positions in equities and reducing their underweights in bonds
as the risk of central banks potentially making hawkish policy mistakes increases.
In addition, Fitch told the US that the Fed's aggressive tightening cycle will put increasing pressure
on job growth and consumer demand in 2023.
Higher inflation and interest rates will cut real wages and will have an impact on household incomes and, ultimately, consumer spending
.

Atlanta Fed President Bostic said Tuesday that inflation is too high and it
must be contained.
In order to maximize job growth, stable prices
are needed.
The Fed cannot solve all the problems
that lead to current inflation.
The U.
S
.
labor market is still in the process of adjusting to new wage and occupational trends that arise as large companies raise wages and attract workers from lower-wage jobs.

Minneapolis Fed President Kashkari said he was not ready to announce a pause in rate
hikes until I saw some convincing evidence that core inflation had at least peaked.
Without supply-side help, the Fed needs to do
more.
Inflation is
too high.
We get a lot of complex signals
.
There is some evidence that the job market is slowing
.
The Fed needs to be aware of the feedback
from a strong dollar and other global feedback loops to the U.
S.
economy.
The Federal Reserve does not set monetary policy
globally.
My confidence in the level of inflation in 6 months is very low
.
Our job is to reduce inflation
.
Central bankers around the world are united in their desire to reduce inflation
.
I can easily see interest rates around 4% next year
.
If there is no progress in inflation, I don't understand why interest rates shouldn't be raised
.

The U.
S.
government plans to release more strategic crude oil reserves to pressure oil prices

The Biden administration plans to release more strategic crude oil reserve SPR to ease tight oil supplies as the White House tries to control gasoline prices
ahead of the November midterm elections.
US President Joe Biden will develop a plan to complete emergency oil sales and stimulate US oil production
.
Senior administration officials announced Tuesday that President Biden is expected to authorize the release of more oil from the Strategic Petroleum Reserve (SPR) to lower natural gas prices
.
Officials say 15 million barrels of crude will be released in December, part of
the 180 million barrels announced by the government earlier this year.
Biden will present plans
on Wednesday to continue using the Strategic Petroleum Reserve to make gas prices more stable.
Biden will reiterate that gasoline companies are too profitable and that they should return them to consumers
.
The Biden administration agreed to buy oil when it fell below $67 to $72 a barrel to replenish emergency reserves
.

Biden will announce an increase of 15 million barrels from the SPR in December, extending the initial timeline and fulfilling a commitment
of 180 million barrels.
SPR remains the largest reserve, and the Department of Energy is willing to sell more
after December if necessary.
Biden stressed to his advisers that we need to be vigilant and that we will be prepared
if a significant additional SPR sale is needed in the coming months.
The Biden administration will take all measures, including restrictions on fuel exports, to address energy prices - senior administration officials
.
Biden's aim is to ensure that there is enough oil
on the US market.
To make sure we have enough supply
no matter what happens.
The oil industry should take Biden's move as a signal
to increase production.

OPEC+ defended its decision to cut production, which could ease downward pressure on oil prices

OPEC+ agreed to cut its production quota by 2 million barrels per day at its meeting at the beginning of the month, prompting condemnation
from oil consuming countries including the United States.
But UAE Petroleum Minister Mazroui argued that the decision was driven purely by supply and demand factors, as the rising risk of a global recession would weigh on the underlying demand outlook, and the drop in oil prices since the meeting showed it was the right decision
.

At the same time, OPEC Secretary General Gaisce said that OPEC unanimously decided to cut oil production to prevent the outbreak of the crisis and curb market volatility
.
With macroeconomic headwinds forecast for the coming months and the high probability of a global recession, some might say that a global recession has already begun in some parts of the world
.
The Ministers therefore agreed that action must be taken now to prevent future crises
.