US crude stocks down 4.4 million barrels

The Energy Information Administration reported on Wednesday that US crude stocks fell for the seventh straight week.

US crude stocks at lowest point since mid-February

The Energy Information Administration reported on Wednesday that US crude stocks fell for the seventh straight week as refiners processed near record amounts of crude last week.

Along with the 4.4 million barrel drop in crude inventories, the EIA reported gasoline and distillate inventories also fell.

Crude stocks sat at 516.3 million barrels last week, the smallest since mid-February.  Analysts are taking the drop as a sign that the OPEC supply cuts are starting to impact the United States, the world’s largest consumer of oil.

On Thursday, OPEC along with some non-OPEC nations will meet in Vienna to discuss extending the supply cut agreement into the first quarter of next year.

According to the EIA, refinery crude runs rose 159,000 barrels per day (b/d) to 17.281 million b/d last week, the second highest volume of crude processed since the EIA began collecting data in 1982.

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As well, refinery utilization rate were up by 0.1 per cent to 93.5 per cent of nationwide capacity.

“Gasoline demand is picking up in the U.S., which also resulted in larger-than-expected crude drawdown despite higher oil production and imports,” Abhishek Kumar, senior energy analyst at Interfax Energy’s Global Gas Analytics in London told Reuters.

Product exports are supporting high refining rates according to refiners.  The EIA reports product exports have averaged 4.7 million b/d over the past four weeks, up over 30 per cent since this time last year.

Oil production in the US also rose to 9.23 million b/d from 9.301 million b/d.  Crude imports rose by 165,000 b/d.

At the Cushing, Oklahoma delivery hub for crude futures, crude stocks dropped by 741,000 barrels.

Gasoline stocks fell by 787,000 barrels, lower than analysts’ expectations in a Reuters poll of a 1.2 million-barrel drop.

Distillate inventories, including diesel and heating oil, were down by 485,000 barrels.  Analysts had expected a 743,000-barrel reduction.