EIA: Oil Inventories Up 2.4 Million Barrells, Continuing Trend of Builds Over Recent Weeks.
- Crude oil: +2.4M
- Domestic prod: 12.3MMbpd
- SPR: NC
- Cushing: +1.1M
- Gasoline: +5.0M
- Implied mogas demand: 8.43MMbpd
- Distillates: +2.9M
- Refiner utilization: 87.9%
- Total exports: 9.16MMbpd
After three weeks of inventory builds, two of which were substantial, the U.S. crude inventories stand at 455.1 million barrels, which is 4% higher than the five-year average for this time of year. The EIA estimated a 5 million barrel increase in gasoline inventory for the week ending February 3, with daily production averaging 9.1 million barrels. This was an improvement from the previous week’s 2.6 million barrel inventory build and 9.4 million bpd production rate.
The EIA also reported a 2.9 million barrel inventory build in middle distillates last week. With daily production at an average of 4.7 million bpd, compared to the previous week’s 2.3 million barrel inventory build and 4.7 million bpd production rate. Despite stabilization in middle distillate stocks towards the end of 2022, market analyst John Kemp warns that a pickup in manufacturing and freight transport activities will quickly lead to supply tightness. Oil prices closed with a gain on Tuesday, due to Fed Chairman Jerome Powell’s announcement of more rate hikes and continued expectations of strong Chinese oil demand. At the time of writing, Brent crude and West Texas Intermediate were both up, with Brent trading above $84 and WTI close to $78 per barrel.
