US Crude Inventories Rise Despite Hormuz Disruptions

The American Petroleum Institute (API) reported that US crude oil inventories increased by 3.296 million barrels in the week ending July 24, following a 2.603 million barrel rise in the previous week.

This is despite concerns about disruptions to global oil supplies due to tensions in the Strait of Hormuz, which have led to increased risk premiums in oil prices.

The Strategic Petroleum Reserve (SPR) has been drawing down its stockpiles to help offset these supply disruptions, with 3.7 million barrels leaving the reserve in the week ending July 24, bringing the total to 307.7 million barrels - a level that is far lower than the 2023 low and the lowest level in over 43 years.

The SPR's inventories are now 424 million barrels shy of maximum capacity, raising concerns about its ability to pump and process oil efficiently if the reserve drops below 250-300 million barrels.