U.S. Crude Inventories Drop Sharply by 11.5 Million Barrels, Hitting Multi-Month Lows

June 18, 2025 
By khanapara

U.S. Crude Inventories

In a surprising turn for global energy markets, U.S. crude oil inventories posted a massive draw of 11.5 million barrels for the week ending June 13, 2025, according to the latest data from the U.S. Energy Information Administration (EIA). The sharp drop significantly exceeded analyst expectations and brought total commercial crude stockpiles down to 420.9 million barrels — nearly 10% below the five-year average for this period.

The data signals either strong underlying demand or a steep decline in crude imports, suggesting tighter supply conditions heading into the summer.

Market Reaction: Brent and WTI Prices Diverge

Crude oil prices responded mixedly to the report. As of 10:39 a.m. ET, benchmark Brent crude was trading at $75.54 per barrel, down 1.19%, while WTI (West Texas Intermediate) rose by 0.99% to $74.10 per barrel.

Traders had already been anticipating a substantial draw following the American Petroleum Institute’s (API) estimate on Tuesday, which pegged the weekly inventory drop at 10.1 million barrels — itself well above the 600,000-barrel draw predicted by market analysts. The EIA’s even larger reported drawdown only reinforced the view that U.S. inventories are being rapidly depleted, putting upward pressure on prices in the medium term.

Gasoline and Distillate Inventory Trends

While crude inventories fell sharply, the EIA report also highlighted shifts in refined product supplies:

  • Gasoline inventories saw a modest build of 200,000 barrels, despite rising demand.

  • Production of motor gasoline increased to 10.1 million barrels per day, up from 9.7 million the week prior.

  • Distillate inventories (including diesel and jet fuel) rose by 500,000 barrels, with daily output climbing to 5.0 million barrels.

  • However, distillate stockpiles remain 17% below the five-year seasonal average, pointing to ongoing tightness in middle distillate markets.

These figures suggest that while gasoline supplies are relatively balanced, distillates continue to experience structural shortages, likely driven by both reduced refining margins and seasonal demand shifts.

Demand Signals Remain Mixed

According to the EIA, total petroleum products supplied — a key proxy for demand — averaged 20.0 million barrels per day over the past four weeks. This figure is broadly flat year over year, suggesting that while overall demand hasn’t weakened, growth remains muted.

  • Gasoline demand stood at 9.0 million barrels/day — a stable figure for this time of year.

  • Distillate product demand came in at 3.5 million barrels/day, down 4.2% from last year.

This divergence highlights the complexities in current consumption patterns, with consumer fuel use holding steady, but industrial and commercial sectors showing signs of softness.

What’s Driving the Massive Drawdown?

Several factors could be behind this unexpectedly large crude draw:

  1. Falling Imports: A reduction in foreign crude shipments could be tightening domestic inventories.

  2. Seasonal Refining Trends: Refineries may be pulling more barrels from storage in preparation for peak summer fuel demand.

  3. Strong Export Activity: Higher international demand for U.S. crude and products could also be draining stockpiles.

  4. Maintenance-related production shifts: Some regional refining outages or transitions may have disrupted import balancing.

Either way, the outsized draw is likely to reinforce a bullish outlook on crude prices unless offset by a production rebound or a sudden drop in demand.

FAQs: U.S. Crude Oil Inventory Report – June 2025

1. Why did U.S. crude inventories drop so sharply?
The 11.5 million barrel draw is attributed to either strong domestic demand, falling imports, or increased refinery activity ahead of the summer travel season.
2. How does this inventory level compare to historical averages?
At 420.9 million barrels, commercial crude stockpiles are 10% below the five-year seasonal average, indicating tighter-than-usual supply.
3. What impact did the report have on oil prices?
WTI prices rose while Brent declined slightly, showing mixed market sentiment. However, the draw is generally seen as bullish for prices.
4. Are gasoline and diesel inventories also falling?
Gasoline inventories rose slightly, while distillate inventories remain 17% below the five-year average, highlighting continued diesel supply tightness.
5. What does this mean for the oil market outlook?
If large inventory draws continue, oil prices could rise, especially with stable demand and tight supply. However, broader macroeconomic conditions will also play a key role.

NOTE – The 11.5 million barrel draw reported by the EIA is one of the largest in recent memory and could mark a critical shift in oil market dynamics. With gasoline production ramping up, distillate stocks under pressure, and total supplies tightening, traders and policymakers will be watching upcoming inventory reports closely for signs of continued supply stress or a price rebound.