diff --git a/.changeset/itchy-ants-smoke.md b/.changeset/itchy-ants-smoke.md
new file mode 100644
index 0000000000..782317df82
--- /dev/null
+++ b/.changeset/itchy-ants-smoke.md
@@ -0,0 +1,5 @@
+---
+"@medusajs/medusa": patch
+---
+
+Fix inventory adjustments
diff --git a/packages/medusa/src/api/routes/admin/draft-orders/register-payment.ts b/packages/medusa/src/api/routes/admin/draft-orders/register-payment.ts
index 88509b5751..96144e0c77 100644
--- a/packages/medusa/src/api/routes/admin/draft-orders/register-payment.ts
+++ b/packages/medusa/src/api/routes/admin/draft-orders/register-payment.ts
@@ -3,6 +3,7 @@ import {
   DraftOrderService,
   OrderService,
   PaymentProviderService,
+  ProductVariantInventoryService,
 } from "../../../../services"
 import {
   defaultAdminOrdersFields as defaultOrderFields,
@@ -10,6 +11,8 @@ import {
 } from "../orders/index"
 
 import { EntityManager } from "typeorm"
+import { Order } from "../../../../models"
+import { MedusaError } from "medusa-core-utils"
 
 /**
  * @oas [post] /draft-orders/{id}/pay
@@ -71,43 +74,90 @@ export default async (req, res) => {
   )
   const orderService: OrderService = req.scope.resolve("orderService")
   const cartService: CartService = req.scope.resolve("cartService")
+  const productVariantInventoryService: ProductVariantInventoryService =
+    req.scope.resolve("productVariantInventoryService")
   const entityManager: EntityManager = req.scope.resolve("manager")
 
-  let result
-  await entityManager.transaction(async (manager) => {
-    const draftOrder = await draftOrderService
-      .withTransaction(manager)
-      .retrieve(id)
+  const order = await entityManager.transaction(async (manager) => {
+    const draftOrderServiceTx = draftOrderService.withTransaction(manager)
+    const orderServiceTx = orderService.withTransaction(manager)
+    const cartServiceTx = cartService.withTransaction(manager)
 
-    const cart = await cartService
-      .withTransaction(manager)
-      .retrieveWithTotals(draftOrder.cart_id)
+    const productVariantInventoryServiceTx =
+      productVariantInventoryService.withTransaction(manager)
+
+    const draftOrder = await draftOrderServiceTx.retrieve(id)
+
+    const cart = await cartServiceTx.retrieveWithTotals(draftOrder.cart_id)
 
     await paymentProviderService
       .withTransaction(manager)
       .createSession("system", cart)
 
-    await cartService
+    await cartServiceTx.setPaymentSession(cart.id, "system")
+
+    await cartServiceTx.createTaxLines(cart.id)
+
+    await cartServiceTx.authorizePayment(cart.id)
+
+    let order = await orderServiceTx.createFromCart(cart.id)
+
+    await draftOrderServiceTx.registerCartCompletion(draftOrder.id, order.id)
+
+    await orderServiceTx.capturePayment(order.id)
+
+    order = await orderService
       .withTransaction(manager)
-      .setPaymentSession(cart.id, "system")
+      .retrieveWithTotals(order.id, {
+        relations: defaultOrderRelations,
+        select: defaultOrderFields,
+      })
 
-    await cartService.withTransaction(manager).createTaxLines(cart.id)
+    await reserveQuantityForDraftOrder(order, {
+      productVariantInventoryService: productVariantInventoryServiceTx,
+    })
 
-    await cartService.withTransaction(manager).authorizePayment(cart.id)
-
-    result = await orderService.withTransaction(manager).createFromCart(cart.id)
-
-    await draftOrderService
-      .withTransaction(manager)
-      .registerCartCompletion(draftOrder.id, result.id)
-
-    await orderService.withTransaction(manager).capturePayment(result.id)
-  })
-
-  const order = await orderService.retrieveWithTotals(result.id, {
-    relations: defaultOrderRelations,
-    select: defaultOrderFields,
+    return order
   })
 
   res.status(200).json({ order })
 }
+
+export const reserveQuantityForDraftOrder = async (
+  order: Order,
+  context: {
+    productVariantInventoryService: ProductVariantInventoryService
+    locationId?: string
+  }
+) => {
+  const { productVariantInventoryService, locationId } = context
+  await Promise.all(
+    order.items.map(async (item) => {
+      if (item.variant_id) {
+        const inventoryConfirmed =
+          await productVariantInventoryService.confirmInventory(
+            item.variant_id,
+            item.quantity,
+            { salesChannelId: order.sales_channel_id }
+          )
+
+        if (!inventoryConfirmed) {
+          throw new MedusaError(
+            MedusaError.Types.NOT_ALLOWED,
+            `Variant with id: ${item.variant_id} does not have the required inventory`,
+            MedusaError.Codes.INSUFFICIENT_INVENTORY
+          )
+        }
+
+        await productVariantInventoryService.reserveQuantity(
+          item.variant_id,
+          item.quantity,
+          {
+            lineItemId: item.id,
+            salesChannelId: order.sales_channel_id,
+          }
+        )
+      }
+    })
+  )
+}
diff --git a/packages/medusa/src/api/routes/admin/orders/cancel-fulfillment.ts b/packages/medusa/src/api/routes/admin/orders/cancel-fulfillment.ts
index f9bd252803..99986f48e7 100644
--- a/packages/medusa/src/api/routes/admin/orders/cancel-fulfillment.ts
+++ b/packages/medusa/src/api/routes/admin/orders/cancel-fulfillment.ts
@@ -8,6 +8,7 @@ import { defaultAdminOrdersFields, defaultAdminOrdersRelations } from "."
 import { EntityManager } from "typeorm"
 import { MedusaError } from "medusa-core-utils"
 import { Fulfillment } from "../../../../models"
+import { IInventoryService } from "../../../../interfaces"
 
 /**
  * @oas [post] /orders/{id}/fulfillments/{fulfillment_id}/cancel
@@ -63,6 +64,8 @@ export default async (req, res) => {
   const { id, fulfillment_id } = req.params
 
   const orderService: OrderService = req.scope.resolve("orderService")
+  const inventoryService: IInventoryService =
+    req.scope.resolve("inventoryService")
   const productVariantInventoryService: ProductVariantInventoryService =
     req.scope.resolve("productVariantInventoryService")
 
@@ -88,10 +91,12 @@ export default async (req, res) => {
       .withTransaction(transactionManager)
       .retrieve(fulfillment_id, { relations: ["items", "items.item"] })
 
-    await adjustInventoryForCancelledFulfillment(fulfillment, {
-      productVariantInventoryService:
-        productVariantInventoryService.withTransaction(transactionManager),
-    })
+    if (fulfillment.location_id && inventoryService) {
+      await adjustInventoryForCancelledFulfillment(fulfillment, {
+        productVariantInventoryService:
+          productVariantInventoryService.withTransaction(transactionManager),
+      })
+    }
   })
 
   const order = await orderService.retrieve(id, {
diff --git a/packages/medusa/src/helpers/test-request.js b/packages/medusa/src/helpers/test-request.js
index cb0ee38003..9201a9848c 100644
--- a/packages/medusa/src/helpers/test-request.js
+++ b/packages/medusa/src/helpers/test-request.js
@@ -11,6 +11,8 @@ import { moduleHelper } from "../loaders/module"
 import passportLoader from "../loaders/passport"
 import servicesLoader from "../loaders/services"
 import strategiesLoader from "../loaders/strategies"
+import registerModuleDefinitions from "../loaders/module-definitions"
+import moduleLoader from "../loaders/module"
 
 const adminSessionOpts = {
   cookieName: "session",
@@ -24,6 +26,7 @@ const clientSessionOpts = {
   secret: "test",
 }
 
+const moduleResolutions = registerModuleDefinitions({})
 const config = {
   projectConfig: {
     jwt_secret: "supersecret",
@@ -31,6 +34,7 @@ const config = {
     admin_cors: "",
     store_cors: "",
   },
+  moduleResolutions,
 }
 
 const testApp = express()
@@ -64,6 +68,7 @@ featureFlagLoader(config)
 servicesLoader({ container, configModule: config })
 strategiesLoader({ container, configModule: config })
 passportLoader({ app: testApp, container, configModule: config })
+moduleLoader({ container, configModule: config })
 
 testApp.use((req, res, next) => {
   req.scope = container.createScope()
diff --git a/packages/medusa/src/services/order.ts b/packages/medusa/src/services/order.ts
index 548ec0c9b0..fc0a18e7c8 100644
--- a/packages/medusa/src/services/order.ts
+++ b/packages/medusa/src/services/order.ts
@@ -1146,23 +1146,13 @@ class OrderService extends TransactionBaseService {
       const inventoryServiceTx =
         this.productVariantInventoryService_.withTransaction(manager)
 
-      const previouslyFulfilledQuantities = order.fulfillments.reduce(
-        (acc, f) => {
-          return f.items.reduce((acc, item) => {
-            acc[item.item_id] = (acc[item.item_id] || 0) + item.quantity
-            return acc
-          }, acc)
-        },
-        {}
-      )
-
       await Promise.all(
         order.items.map(async (item) => {
           if (item.variant_id) {
             return await inventoryServiceTx.deleteReservationsByLineItem(
               item.id,
               item.variant_id,
-              item.quantity - (previouslyFulfilledQuantities[item.id] || 0)
+              item.quantity
             )
           }
         })