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The report had no immediate impact on oil prices; prior to the release, crude was already lower on the back of sinking equity markets and bearish API survey data.

Taking a closer look at the numbers, total petroleum inventories are tracking closely with year ago levels. The surplus versus the 5-year average is now 66.327 million barrels, or 6.4%, down from 6.6% a week ago.

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Crude oil inventories, on the other hand, have been building counter-seasonally for the last two weeks, sending the surplus versus the 5-year average to 29.378 million barrels, or 8.8%, the highest such surplus since October of 2009.

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Both gasoline and distillate inventories remain above normal, with the latter still at historic highs. Gasoline inventories are 7.811 million barrels, or 3.7% above the 5-year average, while distillate inventories are 30.634, or 24.3% above the 5-year average.

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On the demand side, over the last four-week period, total petroleum consumption has averaged 19.6 million barrels per day, which is up 6.9% from the year ago period. Over the same period, gasoline demand averaged 9.2 million barrels per day, up 0.8% year-over-year, while distillate demand averaged 3.9 million barrels per day, up 12.8%.

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Crude oil imports are running ahead of the year ago level; over the last four weeks, imports have averaged 9.7 million barrels per day, up 0.477 million barrels per day year-over-year. Product imports are running close to the levels of a year ago.

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Oil inventories at Cushing, Oklahoma, the NYMEX delivery point, fell 0.8 million barrels.

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Calendar spreads at the front of the futures curve have tightened significantly since Cushing inventories peaked under 38 million barrels a few weeks ago. Aug/Sep is currently about -0.70, while Sep/Oct is -0.60. The prompt month spread peaked at -4.60 a little over a month ago.

U.S. crude oil production was flat compared to a week ago, but up 4.6% from the year ago level. Year-to-date, production is up 3.5% from the comparable period a year ago. Output levels will be closely watched to see whether the situation in the Gulf of Mexico is having any impact.

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