Hormuz Risks Keep Oil Prices Firm Amid U.S. Inventory Build
The latest report from the Energy Information Administration (EIA) shows that U.S. crude oil inventories have built up unexpectedly, reaching a 4.4 million barrel increase in the latest week.
This development is significant because it contrasts with the bullish fundamentals supporting oil prices due to potential disruptions at the Hormuz and Red Sea Straits.
The EIA's August 20 report also shows that natural gas working gas in storage has reached a comfortable level, with a weekly inventory injection of 16 Bcf putting total storage at 3,169 Bcf, 185 Bcf above the five-year average.
Despite high LNG exports, these inventories are enough to mitigate concerns about shortages at home. For now, security in the Persian Gulf is being maintained by the U.S. and its allies.