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Weekly EIA statistics on US oil inventories 19/09/2012

Published Wednesday, September 19th, 2012

Main product stocks fell despite the market expected builds and despite refinery runs were up by 4.2%. This bullishness, however, was overshadowed by the enermous build in crude oil inventories. Due to the jump in crude oil stocks total commercial stocks also increased and they are 28.4 million bbls or 2.6% higher than a year ago and 29.7 mln bbls or 2.7% higher than the 5-year average.

Not surprisingly the biggest build in crude oil stocks took place in the USGC as production has resumed after Hurricane Isaac. The build of 3.12 million barrels in PADD1 was unexpected.  This drawdown was most likely assisted by the 6.3% increase in refinery utilization that reached 91.1% in the US East Coast. The big total build was also the result of crude oil imports rising by 1.3 mbpd to 9.81 mbpd, the highest level since January. Crude oil stocks at Cushing, Oklahoma fell by 0.3 million bbls. Nationwide crude oil stocks are 28.6 million bbls or 7.8% higher than this time of last year and 29.73 million bbls or 8.1% above the 5-year average.

Gasoline might come to the rescue as stocks dropped by 1.41 million bbls despite the market expected a build of 1.2 million bbls. Gasoline stocks in PADD1 fell by 2.3 million bbls. Inventories in this product are the lowest since October 2008 and are 17.8 million bbls or 9.1% below last year’s levels and 9.4 million bbls or 4.8% below the 5-year average.

On balance, the tiny draw in distillate inventories has to be viewed as constructive too since analysts expected a build of 1 million bbls. The distillate picture is far away from bearish: current stocks are 29.4 million bbls or 22.9% lower than a year ago and 23.4 million bbls or 18.2% below the 5-year average. The general fall in product inventories could have been caused by net product imports that stood at 700,000 bpd last week.

Total product demand was down 2.9% at 18.60 mbpd last week compared to a year ago on the 4-week average basis. Gasoline demand fell  by 0.9% to 8.89 mbpd and distillate demand was down by 11.2% at 3.44 mbpd on the same basis.

Posted by Tamas Varga

Tamas Varga has been in the oil industry since 1992 and with PVM for 18 years. During his time in the industry he has gathered a range of experience in the oil markets. At PVM Tamas is in charge of data collection and analysis.