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US crude stocks fall unexpectedly for third week

US crude stocks

US crude stocks dropped by 6.2 million barrels last week. A Reuters poll showed analysts expecting an increase of 3.4 million barrels. Reuters photo by Rick Wilking.

US crude stocks down 6.2 million barrels

By David Gaffen

Sept 21 (Reuters) – US crude stocks fell sharply last week, the third consecutive week of unexpected declines, while gasoline stocks decreased nationwide but posted record builds on the Gulf Coast amid the shutdown of a key pipeline, data from the Energy Information Administration showed on Wednesday.

Crude inventories fell 6.2 million barrels in the week to Sept. 16, compared with expectations in a Reuters poll for an increase of 3.4 million barrels.

It marked the third straight week of draws, surprising traders who expected a rebound after a 14.5 million-barrel draw in the week to Sept. 2, the biggest weekly drawdown since 1999.

U.S. crude imports rose last week 77,000 barrels per day.

Imports to the U.S. Gulf, however, dropped sharply to 2.9 million b/d from 3.4 million b/d the previous week, close to record low rate of 2.5 million b/d hit in the week to Sept. 2 when a Tropical Storm Hermine disrupted supplies.

Gasoline stocks fell 3.2 million barrels nationwide, compared with analysts’ expectations for a 567,000-barrel drop.

Gulf Coast gasoline inventories, however, rose 4.8 million barrels last week, a record weekly build, to the highest level ever for this time of year at 83.7 million barrels, the EIA said, amid the shutdown of the 1.3 million barrel per day Colonial pipeline that runs from the Gulf to the East Coast.

Meanwhile, East Coast stocks posted their largest-ever weekly decline of 8.5 million barrels, slumping to the lowest level since December, 2014 at 55.5 million barrels.

“The Colonial pipeline mess is evident in the gasoline data, which showed supplies stranded in the Gulf and drawn down in the East. We will have to see if the trends normalize next week,” said John Kilduff, partner at New York energy hedge fund Again Capital in New York.

Refinery crude runs fell 143,000 b/d as utilization rates fell 0.9 percentage point to 92 percent of total capacity, EIA data showed.

Distillate stockpiles, which include diesel and heating oil, rose by 2.2 million barrels, versus expectations for a 250,000 barrels increase, the EIA data showed.

Crude stocks at the Cushing, Oklahoma, delivery hub rose by 526,000 barrels, EIA said.

U.S. West Texas Intermediate (WTI) crude futures extended gains after the data. By 11:03 a.m. EDT (1503 GMT), WTI was up $1.05 cents, or 2.4 percent, at $45.10, versus a session peak of $45.49.

(Reporting By David Gaffen; additional reporting by Jarrett Renshaw and Barani Krishnan; Editing by Marguerita Choy)

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