The EIA report pegged total product demand at 19.340 million barrels a day. That included a drop of 505,000 barrels a day for gasoline demand and 520,000 barrels a day for distillate demand from a week earlier.
“A 1.4 million barrel-per-day petroleum-demand drop is the kind of shift one associates with a catastrophic storm or economic plunge,” Kloza said.
“The two-week record for gas demand has now given way to a four-week
average that puts consumption about 0.7% below last year,” he added.
The U.S. government agency also reported an unexpected climb of 3.3 million barrels in domestic crude inventories. That contradicted the drop of 4.6 million barrels for the week reported by the American Petroleum Institute late Tuesday—and was in contrast to the fall of 3.5 million barrels expected by analysts polled by S&P Global Platts.
“The market was geared up for a bid crude-oil draw and got blindsided,” said Phil Flynn, senior market analyst at Price Futures Group.
Even more shocking, the rise for crude inventories came despite a decline in domestic production and the “biggest weekly drop in Saudi imports ever,” according to Flynn.