Companies agree to borrow 40 million barrels from US reserve — OilPrice
In the United States, companies agreed to borrow about 40 million barrels of oil from the Strategic Petroleum Reserve as part of an international stock release program. According to OilPrice, the US Department of Energy allocated nearly 16.8 million barrels on October 28 and another 23.8 million barrels on October 13.
These volumes complete the latest significant portion of Washington's contribution to the program, which involves about 30 countries and provides for the release of approximately 400 million barrels of oil and petroleum products. In March, the United States agreed to lend 172 million barrels under this program.
Return of oil to the reserve
The borrowed oil must be returned to the reserve with interest in the form of additional barrels. According to the Department of Energy's estimate, 44 million barrels are to be returned to storage, with returns beginning early next year. The publication notes that these barrels may help refiners and traders amid limited current supply, but are not a new source of long-term production.
US Strategic Petroleum Reserve stocks fell to 282.6 million barrels last week, the lowest level since October 1982.
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Oil market dynamics
The market was factoring in both the arrival of barrels from the reserve and risks to shipping and energy infrastructure in the Middle East. As of 00:05 GMT on Friday, December WTI futures were trading at $102.77 per barrel, down $0.67, or 0.65%, for the week. Brent closed on Thursday at $114.88 per barrel, having lost $0.44 during the day.
According to the US Energy Information Administration, crude oil inventories fell by 1.9 million barrels in the week ending October 23, although traders had expected a slight increase. Distillate inventories declined by 1.5 million barrels to 102.8 million barrels, while gasoline inventories increased by 3.9 million barrels. Kpler questioned the US oil export figure, noting that the loadings it recorded were about 1 million barrels per day lower than EIA data.
Reports of diplomatic contacts
OilPrice also writes about reports of renewed contacts between Washington, Tehran, and Qatar. According to the publication, Qatari mediators allegedly presented a proposal to end the conflict involving Iran, the United States, and Israel, but an unnamed senior Iranian official rejected it as unacceptable.
