US crude stocks rose 1 million barrels last week: analysts

New York (Platts)--19Nov2012/449 pm EST/2149 GMT

US commercial crude stocks are expected to show a 1 million barrel increase for the reporting week ended November 16, according to analysts polled Monday by Platts.

The American Petroleum Institute releases its weekly report Tuesday at 4:30 p.m. EST (2130 GMT), while the US Energy Information Administration will release its weekly data Wednesday at 10:30 a.m. EST (1530 GMT).

"We are getting past the whole East Coast dilemma," said Carl Larry, president at Oil Outlooks and Opinions. Larry expects an increase in crude imports to support a build in stocks.

But other analysts were not convinced. "The key indication will likely be the comparison of oil inventories with their five-year average," said Tom Pawlicki, director of market research at EOXLive, who expects a slight draw.

The five-year average of EIA data shows crude stocks typically fall 700,000 barrels on the week.

At 375.94 million barrels for the reporting week ended November 9, US crude stocks were 44.33 million barrels, or 13.4%, above the EIA five-year average, the highest it has been in the past two years, according to Pawlicki.

Analysts polled expect US refinery utilization rates to have increased 0.7 percentage points last week.

"There's still a lot of refinery production struggling in [the US Atlantic Coast], but everyone else around the country is doing a nice job of picking up the slack," Larry said.

Pawlicki said that most US Atlantic Coast refineries have "ramped up to normal output" last week, with the exception of Hess's 70,000 b/d Port Reading, New Jersey, refinery and Phillips 66's 238,000 b/d Bayway refinery.

However, by Friday, the Hess facility had resumed operations and is expected to be at full rates early next week, a company spokeswoman said.

The processing units at Bayway refinery in Linden, New Jersey, are in "good condition," Phillips 66 said Saturday in a statement. Pawlicki said the latest on Phillips 66 is that a restart is expected between November 19-26.

Analysts polled expect US gasoline stocks to have increased 1.25 million barrels last week, which is roughly in line with the week-on-week change reflected by the EIA five-year average.

[W]e think runs are high for gasoline and this keeps the stocks building," Larry said. "It will be interesting to see the import numbers and if the EIA is counting the moving barrels from the Jones Act as imports and counting them twice."

The Obama administration granted a blanket waiver of the Jones Act on November 2 to alleviate fuel shortages caused by Hurricane Sandy. The decision allowed foreign-flagged ships to deliver fuel from the Gulf Coast to the Northeast as long as they loaded cargoes by Tuesday and deliver them by November 20.

Twelve foreign-flagged tankers carried 3 million barrels of refined products from the US Gulf Coast to the storm-battered Northeast under the waiver.

At 201.94 million barrels for the reporting week ended November 9, US gasoline stocks were just 0.53% below the EIA five-year average.

Meanwhile, analysts expect US distillate stocks to have declined 1 million barrels for the latest reporting period ended November 16. The EIA five-year average shows distillates typically drop 700,000 barrels over the period.

--James Bambino, james_bambino@platts.com