Investing.com -- Oil stockpiles declined for the sixth-straight week, according to the Energy Information Administration.
Crude stocks plunged 9.3 million barrels last week, according to the latest EIA data. That compares to an expected draw of 1.9 million barrels.
Last week the energy sector braced for a hit from Hurricane Laura, which slammed into the U.S. Gulf Coast but caused less damage than feared to the refining and production operations in the region.
Crude stored at Cushing, Oklahoma, rose 110,000 barrels. Gasoline inventory fell 4.3 million barrels, more than the expected draw of 3 million barrels.
Crude Oil WTI Futures, the U.S. benchmark, fell 2% Wednesday morning after the data release, at $41.89.
“Forget what the EIA data is showing: Just look where the market’s trading and it will tell you what people think of these numbers," said Investing.com analyst Barani Krishnan. "WTI broke below $42 for the low of the day when it should have shot to above $45, if any of these numbers are credible. The oil bulls will of course try and explain it away to a stronger dollar but they’re going to need a more convincing explanation than that."
Hurricane Laura may have led to distortions in the data, Krishnan added. "To me, this dataset has Hurricane Laura distortions written all over it, and few, if any, are buying it. Even the domestic production number looks distorted. I’m not sure how production could have cratered by 1.1 million barrels per day to just 9.7 million when rigs aren’t collapsing like they used to any more, even if they are a lagging indicator. Anyway, this is probably the last of those so-called incredible drawdowns you’re going to see from the EIA ahead of the Labor Day weekend, and after the storm effects are washed out. When that happens, one can just dream of getting a weekly gasoline draw of 4 million barrels.”