U.S. crude and fuel inventories rose last week amid a decline in exports and demand, the Energy Information Administration said on Wednesday. Crude stockpiles rose by 3.9 million barrels to 424.6 million barrels in the week ended September 5, the EIA said, compared with analysts’ expectations in a Reuters poll for a draw of 1 million barrels.
Crude stocks at the Cushing, Oklahoma, delivery hub fell by 365,000 barrels in the week, the EIA said. U.S. crude exports fell by 1.1 million barrels per day to 2.8 million bpd, while net crude imports rose by 668,000 bpd. “A solid drop in exports and a minor drop in refining activity have encouraged a decent build to crude inventories. There have been builds to both gasoline and distillates amid weaker implied demand,” said Matt Smith, an analyst with ship tracking firm Kpler.
Oil futures pared some earlier gains following the surprise build in inventories. Global benchmark Brent crude futures were trading at $67.02 a barrel, up 62 cents by 11:02 a.m. EDT (1502 GMT), while U.S. crude futures were up 63 cents at $63.25.
Refinery crude runs fell by 51,000 bpd, while utilization rates rose by 0.6 percentage point to 94.9%. Total product supplied, a proxy for demand, fell by 871,000 bpd to 19.8 million bpd. Gasoline consumption declined by 609,000 bpd to 8.5 million bpd, while distillate product supplied was down 391,000 bpd to 3.4 million bpd. “We are waiting to see how much gasoline demand will fall off a cliff after the U.S. summer driving season, and it looks like it will be substantial,” said John Kilduff, a partner with Again Capital. “Given the economic data points lately showing an indicated slowdown especially in the labor market, this weak gasoline demand and pattern of low exports could be other indicators of a slowing economy in the U.S. and potential globally,” he added.
Gasoline stocks rose by 1.5 million barrels in the week to 220 million barrels, the EIA said, compared with expectations for a 243,000-barrel draw.
Distillate stockpiles, which include diesel and heating oil, rose by 4.7 million barrels in the week to 120.6 million barrels, versus expectations for a 35,000-barrel rise, the data showed.
(Reporting by Liz Hampton in Denver and Georgina McCartney in Houston; Editing by Marguerita Choy)