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Written by Sumit Roy  |

November 23, 2011

Crude Oil Report: Inventory Deficit Grows, But Brent May Fall To $100 On Eurozone Crisis

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While oil’s fundamentals are extremely bullish, macroeconomic worries may push the commodity lower in the short-term.

The Department of Energy reported this morning that in the week ending Nov. 18, U.S. crude oil inventories decreased by 6.2 million barrels, gasoline inventories increased by 4.5 million barrels, distillate inventories decreased by 0.8 million barrels and total petroleum inventories decreased by 3.9 million barrels.

Crude oil prices were lower after the latest figures on the back of eurozone sovereign debt concerns, with WTI last trading under $96/bbl, while Brent traded near $107.

Though crude oil’s fundamentals clearly remain strong, Brent may move toward support near the $100/bbl in the coming weeks as the crisis in Europe escalates.

Turning to this week’s EIA inventory figures, total petroleum inventories in the U.S. fell by 3.9 mmbbl, against the 5-year average of a 0.2 withdrawal increase. In turn, the inventory deficit grew to 14.7 mmbbl, or 1.4 percent.