New York (Platts)--6May2009

Total US oil demand dropped 410,000 b/d week-over-week to 18.019 million
b/d in the week ended May 1, the lowest level since the week ending September
21, 2001, an analysis of the weekly petroleum data from the Energy Information
Administration showed Wednesday.

Every product category showing a contraction on the year-earlier week,
according to EIA.

On a four-week moving average, total US oil demand at 18.212 million b/d
was down 1.556 million b/d year-over-year, or 7.9% below year-ago levels.

Double-digit percentage losses were seen in every product category except
gasoline. Implied gasoline demand on a four-week moving average was 9.039
million b/d, or down 0.9%, a decline of 0.4 percentage points from the
previous EIA report.

Implied demand for middle distillates continued to deteriorate,
reflecting the general malaise that currently grips the US and global
economies combined with what is historically the lowest demand period of the
year. Demand for middle distillate at 3.527 million b/d was down 14.1%
year-over-year, a decrease of 3.6 percentage points from EIA's previous
report.

Poor demand fed into a higher-than-expected 2.428 million barrel build in
distillate stocks. At 146.5 million barrels, middle distillate inventories
were 36.456 million barrels above the five-year average and 40.809 million
barrels above year-ago levels. And the build in middle distillates was across
the board with diesel, ultra-low sulfur diesel and heating oil stocks rising.

Despite a low level of imports and still mediocre refinery output, total
US product stocks increased 7.3 million barrels to 712 million barrels. At 712
million barrels, total US product stocks were 64.5 million barrels above the
five-year average and 64.4 million barrels above year-ago levels with
surpluses against the averages no longer concentrated in crude oil
inventories.

Even though crude inputs climbed 420,000 b/d to 14.754 million b/d, an
uptick in imports allowed stocks to build, albeit smaller-than-expected.
Stocks rose 605,000 b/d to 375.258 million barrels, leaving inventories 46.585
million barrels above the five-year average and 49.675 million barrels above
year-ago levels. While commercial crude stocks increased at a
smaller-than-expected level. another 2 million barrels were put into the
Strategic Petroleum Reserve. Crude imports edged up 96,000 b/d to 9.92 million
b/d, a fairly high level given that crude runs were still substantially below
15 million b/d
--Linda Rafield, linda_rafield@platts.com