U.S. Oil Inventories Plunge Amid Middle East Tensions and Summer Demand Surge

U.S. commercial crude oil inventories have plummeted to 10% below the five-year average, with a staggering 11.5 million barrel drawdown for the week ending June 13. The drop far exceeds analyst expectations of a 1.6 million barrel decline, settling at 420.9 million barrels. Gasoline inventories saw a modest rise of 200,000 barrels, missing forecasts of a 400,000 increase.

The inventory squeeze stems from robust exports, reduced imports, and refinery throughput nearing 17 million barrels per day. "These factors have conspired to create a massive draw," notes Matt Smith, Kpler's lead oil analyst for the Americas. Meanwhile, geopolitical risks loom as the Israel-Iran conflict threatens the Strait of Hormuz—a chokepoint for 20% of global oil shipments. While the waterway remains open, shipping disruptions are already causing freight costs to climb, with crude futures up 10% in recent weeks.