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U.S. Refiners churning out near records as demand remains robust

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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 rose 1.2 million barrels (MMbbl) to a total of 417.9 MMbbl. At 417.9 MMbbl, inventories are 85 MMbbl below last year (16%) and are 2% below the five year average for this time of year. Stockpiles at the major delivery point in Cushing, OK, fell 2.1 MMbbl to a total of 27..8 million barrels.

GASOLINE INVENTORIES:
Gasoline inventories fell 1.5 million barrels to a total of 239.7 MMbbl. At 239.7 MMbbl, inventories are up 2.4 MMbbl, or 1% higher than a year ago and are about 7% higher 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 (- 1.5 MMbbl)
MidWest (- 0.3 MMbbl)
Gulf Coast (- 0.5 MMbbl)
Rockies (+ 0.3 MMbbl)
West Coast (- 0.2 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 100,000 barrels last week, to a total of 117.6 MMbbl. At 117.6 MMbbl, inventories are down 33 MMbbl, or 22% lower vs a year ago. Distillate inventories now stand at 13 percent below the five year average range for his time of year.

IMPLIED GASOLINE DEMAND:
Gasoline supplied to end users amounted to 9.869 MMbbl per day or 139,000 bpd higher than the previous week. So far in 2018, implied (“products supplied”) is 1.2% higher versus 2017, per the EIA.

REFINERY OUTPUT/UTILIZATION:
Refinery utilization increased by 0.4 % vs. last week’s numbers to 96.8 %. Gasoline production increased xxx million barrels per day while distillate fuel production decreased to xxx million barrels per day last week

Utilization rates for the last week were as follows:
East Coast: 99.1% (+1.7%)
Midwest: 96.3% (-0.4%)
Gulf Coast 97.6% (+0%)
Rocky Mountain 93.9% (-4.7%)
West Coast 96.6% (-1.6%)

These percentages show how much of a region’s overall capacity were used o 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 up by 3.3 million barrels ( + 0.3%) versus a year ago and stand at 1.206 billion barrels (excluding he Strategic Petroleum Reserve).

IMPORTS/EXPORTS:
The U.S. imported 9.1 MMbpd of crude oil per day last week, up by 699,000 bpd vs. the previous week, while crude oil exports fell 654, 000 bpd to 2.336 MMbpd. Total motor gasoline imports last week, averaged 966,000 bpd. The U.S. also imported 64,000 bpd of distillate fuels. However, during the same time frame, the U.S. exported 605,000 bpd of finished gasoline and 1,789,000 bpd of distillates. In total, U.S. refineries exported 8.2 MMbpd of oil and petroleum products.

Shortly before the EIA report was released, oil was trading down 30 cents at $73.86 a barrel. Shortly after the report was released oil continued its losses, down 58 cents 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.