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Crude Stockpiles Drop But Refined Product Post A Build

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The Energy Information Administration (EIA) released its weekly report today on the status of petroleum inventories in the United States. Here are some highlights:

CRUDE INVENTORIES:
Crude oil inventories fell 5.3 million barrels (MMbbl) to a total of 396.2 MMbbl. At 396.2 MMbbl, inventories are 72 MMbbl below last year (-7.4%) and are 5% below the five year average for this time of year. Stockpiles at the major delivery point in Cushing, OK, fell 1.24 MMbbl to a total of 23.58 million barrels.

GASOLINE INVENTORIES:
Gasoline inventories rose 1.25 million barrels to a total of 235.9 MMbbl. At 235.9 MMbbl, inventories are up 17.6 MMbbl, or 8% higher than a year ago and are about 5% below than the five-year average range for this time of year.

Here’s how individual regions and their and their gasoline inventories fared:
East Coast (+ 0.7 MMbbl)
MidWest (+ 0.0 MMbbl)
Gulf Coast (+ 0.6 MMbbl)
Rockies (- 0.1 MMbbl)
West Coast (+ 0.1 MMbbl)

It’s important to note which regions saw increases/decreases as this information drives prices up (in the case of falling inventories) or down (when inventories rise).

DISTILLATE (DIESEL, HEATING OIL) INVENTORIES:
Distillate inventories increased by 6.16 million barrels last week, to a total of 139.3 MMbbl. At 139.3 MMbbl, inventories are down 15.3 MMbbl, or 6% lower vs a year ago. Distillate inventories now stand at 4 percent below the five year average range for his time of year.

IMPLIED GASOLINE DEMAND:
Gasoline supplied to end users amounted to 9.65 MMbbl per day or 85,000 bpd lower than the previous week. So far in 2018, implied (“products supplied”) is 2.8% higher versus 2017, per the EIA.

REFINERY OUTPUT/UTILIZATION
Refinery utilization increased by 0.3 % vs. last week’s numbers, to 97.1 %. Gasoline production decreased 0.43 million barrels per day to 10.03 million barrels per day while distillate fuel production rose to 5.536 million barrels per day last week

Utilization rates for the last week were as follows:
East Coast: 92.8% (+4.2%)
Midwest: 97.4% (-0.6%)
Gulf Coast 98.6% (+ 1.4%)
Rocky Mountain 93.3% (+3.0%)
West Coast 97.6% (+0.2%)

These percentages show how much of a region’s overall capacity were used to refine oil. It’s important to note these percentages, because the lower the utilization percent, the lower output – which has a direct impact on local gasoline prices. If refiners in a given region have low output, your gas prices are likely to rise.

OVERALL SUPPLY
Total oil stocks in the United States are down by 72.2 million barrels (- 7.0 %) versus a year ago and stand at 1.056 billion barrels (excluding he Strategic Petroleum Reserve).

IMPORTS/EXPORTS
The U.S. imported 7.59 MMbpd of crude oil per day last week, down by 123 thousand barrels vs. the previous week, while crude oil exports rose 320,000 bpd to 1.828 MMbpd. Total motor gasoline imports last week, averaged 1,052,000 bpd. The U.S. also imported 51,000 bpd of distillate fuels. However, during the same time frame, the U.S. exported 680,000 bpd of finished gasoline and 1,1418,000 bpd of distillates. In total, U.S. refineries exported 6.69 MMbpd of oil and petroleum products.

Shortly before the EIA report was released, oil was trading up 1.05 cents at $70.13 a barrel. Shortly after the report was released oil accelerated its gains, up $1.41 a barrel.

Senior Petroleum Analyst, Canada

Dan is a skilled and noted bilingual (French and English) consumer advocate specializing in energy and current affairs. Known as Canada's “Gas Guru,” he founded tomorrowsgaspricetoday.com to better help motorists anticipate the price of gasoline in advance across Canada. He has over three decades of experience in the petroleum industry, as a parliamentarian and an analyst.