U.S. oil reserves remain unchanged, oil at session low

Oil fell to a session low after the Energy Information Administration said in its weekly report that Crude Oil Inventories remained unchanged during last week, compared to the preceding one.

On the New York Mercantile, WTI traded at $94.42 per barrel at 15:11 GMT, down 0.94% on the day. Light, sweet crude rebounded after hitting a session low of $93.71 after EIAs report was published. Days high stood at $95.54 a barrel.

Meanwhile, Brent oil fell 0.63% on the day, standing at $100.63 a barrel at 15:11 GMT. The European benchmark varied between days high and low at $101.68 and $100.29 respectively.

The EIA said in its report that Crude Oil Inventories remained unchanged during the week ending June 21 and totaled 394.1 million, above the average range for this time of the year. The figure mismatched expectations of a 1.7 million barrels decline and disappointed investors, which expected a drop in reserves during the more active driving season in the U.S. Crude inventories rose to 396.3 million barrels earlier in June, the highest since July 1981.

The EIA also reported that gasoline stockpiles gained 3.7 million barrels during the last week and are well above the upper limit of the average range. Distillate fuel stockpiles rose by 1.6 million barrels, remaining in the lower half of the average range for this time of the year. Refineries operated at 90.2 percent of their operable capacity. Gasoline and distillate fuel production both increased last week.

Oil reserves were expected to be significantly lower, which disappointed market players. According to a Bloomberg survey, crude reserves were supposed to fall by 1.75 million barrels last week, while gasoline and distillate fuel inventories should have risen by 875 000 and 650 000 barrels respectively. Refineries were expected to have operated at 89.6% of capacity.

Crude inventories last month swung between a drop of as much as 6.3 million barrels and an increase of 3 million, according to EIA data. Reserves reached a three-decade high in June, standing at $396.3 million barrels. Michael McCarthy, a chief market strategist at CMC Markets in Sydney said for Bloomberg: “The high volatility in the weekly numbers over the last six weeks is a bit of a concern, with major draws and then replenishment. Clearly we are expecting to see declines over the next weeks and months.”

Oil prices drew support earlier in the day as disappointing U.S. data eased speculation over an earlier deceleration of Feds monetary stimulus. The Bureau of Economic Analysis said final Q1 GDP reading mismatched projections of a 2.4% increase, standing at 1.8%, below Q1 2012′s 2.4% figure. Consumer Spending for the first quarter of the year was also lower than anticipated, gaining 2.6%, but straying from the 3.4% forecast and below last year’s Q1 reading of 3.4%. Core Consumer Spending managed to fulfill expectations and stood at 1.3%, remaining unchanged compared to last year.

John Kilduff, a partner at Again Capital LLC, commented on the topic for Bloomberg: “The terrible GDP number gives the Fed room to continue doing what theyve been doing. There probably won’t be a tapering of stimulus anytime soon after this large GDP revision.”