By A rise in U.S. crude oil imports and a sharp drop in domestic refinery utilization rates led to a build in U.S. commercial crude oil stocks during the reporting week ended January 17, data released Thursday by the U.S. Energy Information Administration (EIA) showed.
U.S. refiners pulled back run rates to 86.5% of capacity for the week ended January 17, down 3.5 percentage points week over week. That could be due in part to the start of a refinery maintenance period, analysts said.
The week ended January 17, a unit upset at the 340,000 barrels per day (b/d) Shell/Pemex refinery in Deer Park, Texas, led to flaring; however, a company spokeswoman would not identify the unit or say how long production would be affected.
U.S. crude oil stocks rose 1 million barrels to 351.2 million barrels the week ended January 17, according to the EIA data, running counter to analysts' expectations of a 1.9 million-barrel draw.
Some analysts had been expecting continued low imports as well as a rebound in crude oil runs at U.S. refineries. But analysts were divided, with roughly half expecting a sizable build, in line with the EIA five-year average, which showed crude oil stocks could rise by around 3.4 million barrels.
Crude oil stocks remain above the EIA five-year average, but the surplus to that average narrowed to 3.2% as of the week ended January 17. That is down from a surplus of 13.3% on November 15.
A 2.4 million-barrel crude oil draw in the U.S. Midwest was offset by a 1.8 million-barrel build in inventories on the U.S. West Coast (USWC) and a 900,000-barrel build in the U.S. Gulf Coast (USGC).
USGC refiners lowered their run rates by 3.7 percentage points to 88% of capacity. The four-week moving average for refiners in that region stands at 92.1% of capacity.
Crude oil stocks at the New York Mercantile Exchange (NYMEX) delivery hub at Cushing, Oklahoma, rose for the third consecutive week, increasing 700,000 barrels to 41.6 million barrels. That put Cushing stocks at a 12.6% surplus to the EIA five-year average, although that is less than half the 26.3% surplus as of November 15.
Total imports of crude oil were up 655,000 b/d to 7.54 million b/d, led by a 259,000 b/d rise in imports from Mexico to 814,000 b/d, and a 186,000 b/d jump in imports from Canada to 2.65 million b/d. Crude oil imports from Saudi Arabia and Angola were also higher week over week, rising 167,000 b/d and 173,000 b/d, respectively.
U.S. DISTILLATE STOCKS DROP
U.S. distillate stocks fell 3.2 million barrels the week ended January 17 to 120.7 million barrels, with ultra-low sulfur diesel stocks declining 3.7 million barrels to 98.9 million barrels, EIA data showed.
The draw in distillate stocks surpassed expectations of a 1.2 million-barrel decline, based on a Platts survey of analysts.
Continued firm demand kept inventories on the decline. Implied demand* for distillates rose 55,000 b/d to 3.78 million b/d, more than 400,000 b/d above year-ago levels.
Distillate stocks on the U.S. Atlantic Coast (USAC) and in the U.S. Midwest both fell 1.7 million barrels the week ended January 17, while USGC stocks rose 400,000 barrels.
Total U.S. production at 4.47 million b/d the week ended January 17 was down from the four-week moving average of 4.87 million b/d, but 157,000 b/d higher than year-ago levels.
U.S. gasoline stocks rose 2.1 million barrels to 235.3 million barrels the week ended January 17, compared with estimates of a 1.7 million-barrel build.
Implied demand for the fuel was up 38,000 b/d to 8.06 million b/d, but down by 372,000 b/d from a year earlier.
Gasoline stocks on the USWC grew for a third consecutive week, rising 1.1 million barrels the week ended January 17 to 34.87 million barrels, putting USWC stocks at a 6.1% surplus to the EIA five-year average of 32.87 million barrels. That compares to a deficit of about 1.2% on November 8.
On the USAC -- home of the New York delivery point for NYMEX RBOB -- gasoline stocks fell a marginal 100,000 barrels the week ended January 17 to 62.7 million barrels.
* Implied demand is the amount of product that moves through the U.S. distribution system, not actual end consumption.
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