Crude oil report and price impacts

On Wednesday 25^th September, the US EIA released its weekly petroleum status report. According to the report, US commercial crude inventories increased by 2.6 million bbls last week, maintaining a total US commercial crude inventory to 358.3 million bbls. This figure is close to the upper end of the five year range.

Petroleum product inventories

Gasoline inventories also increased by 200 000 bbls last week and remain in the upper half of the five year average range. Over the past four weeks, total motor gasoline supplied averaged 8.9 million bpd, flat with the prior week average.

Distillate inventories fell by 200 000 bbls last week and remain near the lower limit of the average range. Distillate product supplied averaged 3.7 million bpd over the past four weeks, up by 7.8% when compared with the same period last year. Distillate production totalled approximately 4.8 million bpd last week, approximately 300 000 bpd less than the prior week.

Crude trading

Crude prices were trading higher before the EIA report at US$ 103.45/bbl and slipped to approximately US$ 103.30 shortly after the report was released. Over the last week, crude imports averaged approximately 7.9 million bpd, up nearly 346 000 bpd from the previous week. Refineries were running at 90.3% of capacity, with daily input of 15.6 million bpd, approximately 500 000 bpd lower than the previous week’s total.

According to 24/7 Wall St., the much larger than expected increase in crude oil inventories will weigh on crude prices. Prices have been slipping ever since the situation in Syria moved out of the headlines and into a negotiating room. Refining throughput dropped last week as refineries prepare for making winter fuel, and that likely accounts for the steep growth in inventories. There does not appear to be any constraint on US gasoline supplies however. 

Read the article online at: https://www.hydrocarbonengineering.com/gas-processing/27092013/crude_prices_impacted_by_report696/