Oil Prices Surge Over $3 as EIA Reports Mixed Inventory Data

Front-month crude oil futures surged more than $3 per barrel on Wednesday, with West Texas Intermediate (WTI) closing in on $93 and Brent crude breaking above $101. The rally occurred despite U.S. government data showing a build in nationwide crude inventories.

According to live price data, WTI Crude traded at $92.96 per barrel as of midday, a gain of $3.29 or 3.67%. Brent Crude traded at $101.67, up $3.19 or 3.24%. The Bakken differential, the discount at which North Dakota crude trades versus WTI, was $3.42 per barrel. Natural gas prices saw a modest increase to $2.75, up $0.05.

The price rally defied a reported increase in U.S. commercial crude stocks. Data from the U.S. Energy Information Administration (EIA) released Wednesday showed inventories increased by 1.9 million barrels for the week ending April 17, bringing total stockpiles to 465.7 million barrels, according to OilPrice.com. This build aligned with earlier projections from Macquarie strategists, who had forecast U.S. crude inventories would rise for the week, Rigzone reported.

Market focus, however, shifted to substantial draws in refined products, which signaled robust downstream demand. The EIA reported gasoline inventories fell by 4.6 million barrels, following a 6.3 million-barrel draw the prior week. Distillate inventories, which include diesel, decreased by 3.4 million barrels and are now 8% below the five-year average.

Overall U.S. oil demand remains strong. The EIA's total products supplied, a proxy for demand, averaged 20.5 million barrels per day over the last four weeks, up 3.0% year-over-year. Gasoline demand averaged 8.8 million barrels per day, while distillate demand averaged 4.0 million barrels per day, up 3.4% year-over-year.

For Bakken operators, the midday price surge is a direct positive for wellhead economics. A WTI price above $92, coupled with a Bakken differential near $3.42, implies a local price just under $89.50 per barrel. This price environment supports continued drilling and completion activity in the play. The strong distillate demand is also a favorable indicator for the medium-sweet crude produced in the Bakken, which yields a high proportion of diesel.

The price action suggests traders are looking past the headline crude build and focusing on tightening product markets and solid consumption figures as the primary price drivers.