As we approach the mid-week shuffle, reports are showing sharp drop offs in crude supplies down 4.1 million barrels at the end of last week comparative to analysts forecast of a decline of 2.7 million barrels. Gasoline stockpiles fell by 2.3 million in contrast to the expected 443,000 barrel increase which was what was expected. Bigger draws in gasoline should be expected around this time of the year as we are in the early-mid summer driving season. Distillate stocks fell 2.1 million barrels while a 200,000 barrel increase was initially foretasted according to the data released by the EIA (Energy Information Administration). Prices rose as a result of these statistics which has the market on more of a bullish outlook short term. West Texas Intermediate Crude Oil is up 0.32% at $66.57. RBOB gasoline in July is trading up 1.54% to $2.12 per gallon while Heating Oil is up 0.75% at $2.18 per gallon.
Crude production rose domestically to a weekly record of 10.9 million bpd (barrels per day), not far behind Russia, whom is producing a whopping 11.1 million bpd. Reports of the Permian Basin in Texas and New Mexico show the region is positioned to become the third biggest oil producing region in the world by 2023. Producing around 32 million bdp the Permian is pumping more than other shale producing nations such as Kuwait and Mexico. Foretasted by IHS Markit, if the U.S. could improve pipeline capacity and invest in more drilling in the Permian Basin, the region could surpass output from China, Canada and Iraq. This outlook could be lofty in the long term but something interesting to ponder as U.S. production continues to rise.