US commercial crude stocks jump while product inventories plunge

Analysis of US EIA data


New York - February 21, 2013

U.S. commercial crude stocks continued to accumulate over the week ended February 15, data from the Energy Information Administration (EIA) showed Thursday, climbing 4.143 million barrels to 376.388 million barrels as both imports and domestic production ticked upward while refining capacity continued to slide back on seasonal refinery maintenance.


Data released by the American Petroleum Institute (API) on Wednesday showed an increase of 2.961 million barrels in commercial crude stocks, while analysts polled by Platts had anticipated a 2 million-barrel jump.


Domestic production – which moved above 7 million barrels per day (b/d) during the week ended February 8 – increased by 54,000 b/d to 7.118 million b/d over the reporting week ended February 15. Import volumes increased by 176,000 b/d to 7.689 million b/d.


Crude stocks increased by 3.5 million barrels in the U.S. Gulf Coast region, bringing total inventories to 173.5 million barrels, as imports into the region climbed to 3.525 million b/d – up 345,000 b/d on the week – even as refiners continued to scale back.


Commercial crude inventories slipped by 800,000 barrels along the West Coast and by a marginal 100,000 barrels in the Midwest, though inventories nudged up by 417,000 barrels in Cushing, Oklahoma, the delivery point of the New York Mercantile Exchange (NYMEX) crude contract.


Stocks at Cushing increased to 50.659 million barrels after declining over the previous two reporting weeks.


Enterprise Products Partners – which operates the 400,000 b/d joint venture Seaway Pipeline – announced Tuesday that throughput on the Cushing-Texas crude line will average 295,000 b/d this month.


Throughput on the pipeline was curtailed shortly after its expansion from 150,000 b/d in January to ease congestion along the route after inventories topped out at the Jones Creek, Texas, terminal near Freeport.


Further declines in U.S. refinery runs likely added to the hefty rise in crude inventories, as crude oil inputs declined by 134,000 b/d to 14.176 million b/d over the reporting week ended February 15, while utilization dipped by 0.9 percentage point to 82.9% nationally.


The drop in utilization was carried entirely by the Gulf Coast and East Coast regions, which saw utilization curtailed by 3 percentage points and 3.6 percentage points, respectively. By contrast, utilization increased in the other three reporting regions. Refining utilization stands at 81.8% in the Gulf Coast and 72.3% in the East Coast.


GASOLINE STOCKS SLIDE ON DROP IN IMPORTS; DISTILLATES FALL


Product inventories continued to decline over the course of the reporting week ended February 15, with U.S. gasoline stocks falling 2.884 million barrels to 230.352 million barrels.


The decline in stocks was due to a large decline in Gulf Coast stocks, a slide in gasoline imports into the East Coast, and a slight uptick in implied demand*, which rose by 33,000 b/d to 8.437 million b/d. Stocks declined in three of the five regions, with inventories dropping by 2.6 million barrels in the Gulf Coast region to 77.4 million barrels.


On the East Coast, stocks slipped by 300,000 barrels to 59.5 million barrels as imports into the region declined by 159,000 b/d over the reporting week ended February 15.


Analysts polled by Platts anticipated a 1.4 million-barrel decline in gasoline stocks, while Wednesday's API data showed a much smaller 122,000-barrel dip in inventories.


Distillate stocks continued to fall, even as implied demand for the fuel partially reversed the reporting week’s heavy increase, dropping 134,000 b/d to 3.808 million b/d. Nationally, distillate fuel inventories fell 2.277 million barrels to 123.627 million barrels.


Inventories declined in four of the five reporting regions, with the biggest decline seen on the East Coast, where inventories fell 1.3 million barrels to 36.2 million barrels.


API data showed a fall of 1.641 million barrels in distillate stocks while analysts anticipated a 1.4 million barrel decline.


* Implied demand is the amount of product that moves through the U.S. distribution system, not actual end consumption.


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