Crude oil stocks at Oklahoma’s Cushing Hub remained in dangerous territory or close to the minimum operating level, according to the latest petroleum storage update from the federal government.
The U.S. Energy Information Administration reported that in the past week, Cushing managed an increase of 100,000 barrels of oil, creeping up from the 22 million barrels reported on September 22 to 22.1 million barrels as of September 29.
Compared to a year ago, Cushing remained nearly 15% below what was stored in September 2022 when it held 26 million barrels. The drop was close to 38% compared to two years ago when Cushing held 35.5 million barrels of crude oil. Cushing has a reported capacity of holding 98 million barrels of crude oil.
The immense decline in crude held at the Culshing Hub could spark more worry about quality and the possibility of stocks slipping below the minimum level. It is reported the low level is also partially behind recent higher prices of West Texas Intermediate crude.
As OilPrice.Com recently reported low levels can make the oil more difficult to pump from the large tanks that old the crude.
“If you let the crude (level) drop too low, the crude can get sludgy and you can’t get it out. What does come out – you won’t be able to use,” Wood Mackenzie sales director Carl Larry told Reuters.
Cushing’s slight gain was opposite of what happened nationally when the amount of U.S. commercial crude oil inventories dropped by 2.2 million barrels from the previous week. The EIA said that at 414.1 million barrels, U.S. crude oil inventories are nearly 5% below the five-year average for this time of year.
US inventories fell from 416.3 million barrels on Sept. 22 to the current 414.1 million as of Sept. 29. The latest inventory is also about 3.5% lower than the total stored a year ago and nearly 2% below two years ago when it was 420.9 million barrels.
It also affected the nation’s operational abilities. The EIA said refineries operated at 87.3% of their operable capacity last week. Gasoline production decreased last week, averaging 8.8 million barrels per day. Distillate fuel production decreased last week, averaging 4.7 million barrels per day.