US Oil Stocks Decline by 2.6 million Barrels Amid Unrest in Iraq; US Oil Import Declines

The Department of Energy’s weekly inventory report for crude oil stocks has revealed a reduction of 2.6 million barrels, which exceeds the expected 1.2 million barrels. Prices went up prior to the report and have been oscillating around the 104.5 level since then.

CNBC‘s Jackie DeAngelis reports that analysts believe June to be a month when refineries tend to build up inventories in anticipation on an increase in demand further down the road. However, she also points to the decrease in imports of oil and an increase in the use of the US domestic supply as a more probable explanation for the numbers.

The geopolitical factor is also believed to play an important role, as it has an impact not only on BRENT, but also on WTI. The current crisis in Iraq, where an al-Qaeda splinter group took control of the city of Mosul in the norther part of the country has instilled some fear in the market. Oil Minister Abdul Kareem Luaibi was quick to calm the markets and to assure that oil exports will not be affected in any way. The minister has also revealed Iraq’s plans to increase production by 4 million barrels per day by the end of 2014.

At its latest meeting in Vienna, OPEC officials have maintained the organization’s production ceiling. According to Bloomberg, for the next six months, the group predicts a demand of 30.4 million barrels per day, while production in April has been 29.6 million barrels a day.

Watch the full video below:

Only yesterday, during an intervention on CNBC, Smead Capital Management’s Bill Smead has argued for a decline in oil prices due to increased competition. According to him, “every Tom, Dick and Harry in the world is poking holes in the ground” and fierce competition will drive the prices down.

Disclosure: none.

Comments
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months. Our beta is only 1.2 (don't click this link if beating the market isn't important to you).

Lists

The 10 Most Expensive iPhone Apps

The 9 Most Expensive Designer Shoes in the World

The 10 Most Expensive Cigarette Brands

The 10 Most Expensive Law Schools in the US

The 10 Best Wall Street Movies

The 10 Most Expensive Golf Clubs Ever Sold

The 10 Most Expensive Golf Memberships

The 10 Best Disney Characters Ever Created

The 8 Best Foods for Gaining Weight

The 10 Most Expensive Colleges in the World

The 7 Most Memorable Ad Campaigns of All Time

The 7 Most Expensive High Schools in the World

The 10 Electric Vehicles with the Longest Range

The 10 Cities with the Worst Drivers in the World

The 10 Most Expensive Dresses Ever Created

10 Islands to Visit Before You Die

10 Famous Celebrities Who Needed Rehab

The 15 Countries with the Largest Oil Reserves

The 10 Most Overused Excuses in the World

The 5 Best iOS Apps You Can’t Get on Android

5 Companies Damaged By Social Media Blunders

The 10 Most Legendary Blues Songs

The 10 Most Lawless Places in the World

4 Reasons China is a Threat to the US

The 17 Most Sugary Drinks in the World

The 10 Most Ruthless Rulers in History

The 10 Greatest Generals in History

Top 8 Travel Destinations for 2015

The 10 Safest Dog Breeds for Children

The 10 Most Stolen Vehicles in the US

The 7 Most Expensive Celebrity Weddings

The 10 Best LoL Teams in the World

Top 10 Worst Marketing Campaigns Ever Produced

Top 5 Diets that Help You Lose Weight

The 10 Best Ways to Stay Awake

7 Artists That Switched Musical Genres

The 10 Most Expensive Cities to Live in New Jersey

The 10 Best High Schools in New York

The 10 Countries With the Least Gender Inequality

The 6 Biggest Musician-Manager Feuds

The 10 Countries with the Cheapest Gas Prices

The 7 Most Theatrical Bands of All Time

The 8 Worst Band Breakups of All Time

The 10 Most Important South American Leaders

The 7 Most Successful Casting Show Winners

The 10 Most Peaceful Countries in the World

5 Big Reasons Communism Failed

The 15 Most Famous Carl Icahn Quotes

10 Scary Animals that are Actually Harmless

The 8 Most Famous Singer-Actors in Entertainment

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!