This analysis and commentary is provided by Linda Rafield, Platts senior oil analyst
US crude stocks climbed a smaller-than-expected 860,000 barrels for the week ending February 11, with a steep drop in imports behind the modest inventory build, an analysis of weekly oil data released Wednesday by the Energy Information Administration showed.
At 345.917 million barrels, US crude stocks are 16.979 million barrels above the five-year average and 11.414 million barrels above year-ago levels, the EIA data showed.
US crude imports fell 643,000 barrels per day (b/d) to 8.266 million b/d, a three-month low, with the Gulf Coast seeing the brunt of the decline. Imports to the US Gulf dropped 395,000 b/d to 4.845 million barrels b/d, reflecting Mexican port closures that altered Gulf imports.
Inputs to US refineries fell 616,000 b/d to 14.29 million b/d. Again, the Gulf Coast saw the sharpest decline, on maintenance and disruptions caused by unusually cold weather. Gulf Coast refinery inputs declined 586,000 b/d to 6.845 million b/d.
Crude stocks on the Gulf Coast fell 1.542 million barrels to 169.240 million barrels, while Atlantic Coast inventories fell 737,000 barrels to 10.339 million barrels.
Stocks in the other three regions rose, with the increase in the Midwest making it the most likely region to affect the futures market. Midwest crude stocks jumped 1.3 million barrels to 99.119 million barrels; inventories at Cushing, Oklahoma – home of the New York Mercantile Exchange (NYMEX) crude oil future contract’s delivery point – edged up 250,000 barrels to 37.657 million barrels, some 677,000 barrels shy of the all-time high.
While the crude data was somewhat supportive for NYMEX crude prices, the 9.245-million-barrel drop in total product stocks was clearly bullish. A sharp rebound in demand and lower refinery output for every product except gasoline was behind the steep decrease in inventories.
At 723.l781 million barrels, US product stocks were 33.046 million barrels above the five-year average and 12.778 million barrels above year-ago levels.
US oil demand climbed 729,000 b/d to 20.071 million b/d, the first time in seven weeks consumption has jumped back over 20 million b/d.
Demand for gasoline and middle distillates bounced nearly 300,000 b/d, a sign that winter storms had eased last week, with the result being an increase in road and rail traffic.
Gasoline demand climbed 286,000 b/d to 8.81 million b/d, while consumption of middle distillates rose 297,000 b/d to 3.979 million b/d.
Gasoline stocks rose 205,000 barrels to 241.096 million barrels while inventories of middle distillates declined 3.096 million barrels to 161.270 million barrels. Within middle distillates, ultra-low sulfur diesel (ULSD) stocks fell 3.237 million barrels to 112.018 million barrels, while heating oil inventories edged up 69,000 barrels to 38.713 million barrels.
The largest product category decline was seen in propane and propylene, which fell 3.832 million barrels to 30.973 million barrels, likely resulting from higher demand for propane, which is used in the Midwest for winter fuel.
