On Wednesday, oil prices in the United States rallied for a long and finally settling at its highest since 2014 as domestic supplies of crude oil attained their biggest weekly drop of the year. Traders also showed a lot of concern over the threat of the United States sanctioning other countries that do not stop importing oil from Iran by the 4th of November. On Wednesday, the Energy Information Administration of the United States reported that crude supplies reduced by about 9.9 million barrels for the week that concluded on the 22nd of June 2018. This is actually the largest weekly decline of the year. The analysts surveyed by S & P Global Platts had previously predicted a fall of 2.3 million barrels, meanwhile on Tuesday the American Petroleum Institute reported a fall of about 9.2 million barrels.
Matt Smith who is the director of commodity research at ClipperData mentioned that the record crude exports and record refinery runs combined together to yield the biggest draw to the stocks of crude oil in this year. He also added that even the production of crude oil is holding at a record level that has not been able to offset strong domestic as well as international demand. The EIA mentioned in the previous week that the week's total domestic output of crude oil was at about 10.9 million barrels per day which is just unchanged from last week.
As per the EIA, The S&P Global Platts survey predicted the supply to increase by about 160,000 barrels for gasoline and for about 500,000 barrels for distillate stocks. Tom Kloza who is the global head of energy analysis at Oil Price Information Service stated that they would have seen the prices of gasoline rise up further today if it were not due to the imports of gasoline that reached close to about one million barrels per day. He also added that it can be expected that the rest of the peak season to be touch and go for prices and a supply that would be without a lot of fluctuations. The gain in the price of oil came after WTI and Brent closed up by Tuesday by more than about 4 percent and 2 percent respectively. This happened after the threat by the US for sanctioning countries that do not cut their imports of Iranian crude by 4th November 2018.