U.S. crude oil and distillate inventories fell unexpectedly last week as imports declined, while gasoline stockpiles dropped more than forecast, the Energy Information Administration said on Wednesday.
Crude inventories fell by 12.5 million barrels in the week to May 19 to 455.2 million barrels ahead of the driving-intensive Memorial Day weekend holiday, compared with analysts’ expectations in a Reuters poll for an 800,000-barrel rise.
Net U.S. crude imports fell by 1.25 million bpd, the EIA said, while the crude oil adjustment figure fell by 1.16 million barrels per day, according to the EIA data.
Gasoline, jet fuel and distillate product supplied – proxies for fuel demand – each rose last week, helping to fuel the drawdowns in stocks.
Refinery crude runs rose by 79,000 barrels per day, and refinery utilization rates fell by 0.3 percentage point in the week.
“It looks like demand is back. … Refiners are absolutely going max out with refinery runs right now, trying to keep up with demand,” said Phil Flynn, an analyst at Price Futures Group.
Distillate stockpiles, which include diesel and heating oil, fell by 600,000 barrels to 105.7 million barrels, their lowest level since May 2022, EIA data showed.
Gasoline stocks also fell by a more than expected 2.1 million barrels in the week to 216.3 million barrels, the EIA said.
Crude stocks at the Cushing, Oklahoma, delivery hub rose by 1.8 million barrels in the week, the EIA said.
Domestic production rose by 100,000 barrels per day in the week, but the four-week average of 12.275 million barrels per day is only up 3.4 per cent from year ago levels.
“The rate of growth is disappointing given the low price of oil and the fact that producers are slowing down on their capital spending for drilling,” said Andrew Lipow, president of Lipow Oil Associates in Houston.