US Diesel Stocks Fall to 99.3 Million Barrels, Lowest Since 2003, as SPR Draw Continues

Since the Strategic Petroleum Reserve release began in late March, US fuel inventories have kept shrinking. The Energy Information Administration's weekly report today, Nov. 4, shows diesel is now the tightest piece.

Distillate fuel stocks, the category that covers diesel and heating oil, fell 3.6 million barrels in the week ended Oct. 30. That leaves 99.3 million barrels in storage, according to the EIA. It is the lowest level since May 2003 and about 13% below the five-year seasonal norm, per The Wall Street Journal's analysis of the data.

The weekly numbers

Commercial crude stocks, excluding the SPR, dropped 865,000 barrels to 409.8 million. That is 4% under the five-year average and the fifth straight weekly decline.

The SPR gave up another 399,000 barrels, leaving 282.2 million. Combined, total US crude inventories fell about 1.26 million barrels.

Since late March, 133 million barrels have come out of the reserve under a release program of 172 million barrels, coordinated through the International Energy Agency to lower energy costs. That leaves 39 million barrels still to go.

Other figures from the EIA report:

• Gasoline stocks fell 222,000 barrels to 209 million, 2% below the five-year average. Gasoline demand rose 450,000 barrels a day to 8.8 million.
• Cushing, Oklahoma, the delivery point for US crude futures, gained 280,000 barrels to 27.3 million.
• Refinery utilization rose to 94.5% from 92.8%. Crude input to refineries climbed to 16.7 million barrels a day.
• US crude exports fell 1.2 million barrels a day to 3.7 million. Imports held at 6.4 million.

Production is not the problem. Output edged up 11,000 barrels a day to an estimated 14 million, the first weekly reading above that mark in data going back to 1983. Baker Hughes counted 462 active oil rigs on Friday, with two added last week.

Prices fall on the data and the Iran question

Oil dropped after the report. As of 10:40 a.m. ET, Brent traded at $101.30 a barrel, down $2.30. West Texas Intermediate lost $2.19 to $93.90.

Traders are also weighing Tuesday's midterm results, which market commentary at ZeroHedge described as a Democratic sweep of Congress, and what they mean for Trump's Iran policy. The concern is that a Democratic Congress could constrain funding for overseas military operations.

Qatar said Tuesday that mediation between Washington and Tehran is continuing. Both sides are reviewing proposals passed through intermediaries. In an interview with the Financial Times, Trump said he has no immediate plans for more strikes on Iran. "We're locked and loaded if we need to go, but there may be no reason for it," he said.

Emily Ashford, head of energy research at Standard Chartered, said the next 72 hours will show whether renewed diplomatic momentum produces real improvement or is "simply another short-lived correction." She added: "The election doesn't guarantee de-escalation."

ING analysts Warren Patterson and Ewa Manthey said the market has increasingly priced in the risk of further US-Iran hostilities. If the election passes without a fresh escalation or a breakthrough, they said, traders will have to judge whether the geopolitical risk premium in prices can last or will unwind.

Pump prices and the political fallout

The fuel squeeze has reached the ballot box. A CNN analysis of AAA data found that the average price of regular gasoline during Trump's second term, $3.473 a gallon as of Tuesday, has edged past the Biden-era average of $3.471. The gap is a fraction of a penny. CNN reported that the national average is still well above $4, so the second-term figure should keep climbing relative to Biden's.

Patrick De Haan, head of petroleum analysis at GasBuddy, called it "pretty astonishing" and said he doesn't think anyone would have predicted it 10 months ago. Trump had campaigned in 2024 on sub-$2 gas. His first-term average was $2.47.

The White House has defended its record. Spokesperson Taylor Rogers said Trump is "taking tangible steps to increase our refining capacity," while acting immediately by releasing SPR oil, temporarily waiving the Jones Act, and allowing red-dyed diesel for highway use to lower prices at the pump.

On Monday night at a Kansas rally, Trump announced $8 billion in USDA payments to farmers who have suffered losses, "to offset diesel costs during this harvest season." CNN also reported that the administration has bought millions of barrels of Russian diesel and is examining ways to cut shipping costs.

What to watch

The SPR has already been drawn down by more than three-quarters of the planned release, with 39 million barrels left, and diesel stocks are at a 23-year low heading into the winter heating season. The administration has not said what it will do if the release program ends before inventories recover. The next EIA report, due next week, will show whether the diesel draw continues.