EIA: U.S. crude and fuel inventories fall as Iran war roils energy markets
U.S. crude and fuel inventories continued to draw down last week as countries around the globe scrambled to fill supply gaps caused by disruptions from the war with Iran, the U.S. Energy Information Administration (EIA) said on Wednesday.
Crude inventories fell by 2.3 MMbbl to 457.2 MMbbl in the week ended May 1, the EIA said, compared with analysts' expectations in a Reuters poll for a 3.3-MMbbl draw. Crude stocks at the Cushing, Oklahoma, delivery hub USOICC=ECI fell by 648,000 bbl in the week, the EIA said.
Fuel inventories also declined, as exports of petroleum products rose to their highest level on record.
"We see a continued liquidation of refined product and crude oil inventories as the U.S. supplies other regions of the world because of Middle East disruptions," said Andy Lipow, founder of Lipow Oil Associates.
U.S. gasoline stocks fell by 2.5 MMbbl in the week to 219.8 MMbbl, the EIA said, compared with analysts' expectations in a Reuters poll for a 2.1-MMbbl draw.
Distillate stockpiles, which include diesel and heating oil, fell by 1.3 MMbbl in the week to 102.3 MMbbl, their lowest level since 2005, according to EIA data. Analysts had expected a 2.4-MMbbl drop in supply.
U.S. distillate fuel oil exports hit a record 1.9 MMbpd last week, up from 1.6 MMbpd in the prior week, EIA data showed.
"Distillate stockpiles are down 20% since February 6, and that draw is expected to continue as we go into the planting season in the Midwest," said Lipow.
While the drawdown is a concern, the market is less concerned because it’s driven by exports rather than domestic demand, Phil Flynn, senior analyst at Price Futures Group said.
Oil futures extended losses following the report. Global Brent crude futures LCOc1 were trading at $101.96 a barrel, down $7.91 at 10:54 a.m. ET (1454 GMT), while U.S. West Texas Intermediate futures CLc1 were off $7.14 a barrel at $95.13.
Total product supplied, a proxy for demand, fell by 1.647 MMbpd to 19.48 MMbpd. Gasoline consumption was off by 291,000 bpd to 8.81 MMbpd.
Refinery crude runs fell by 42,000 bpd in the week, the EIA said, while utilization rates rose by 0.5% in the week to 90.1%.
Net U.S. crude imports rose by 1.42 MMbpd, EIA said, while U.S. crude exports declined by 1.69 MMbpd to 4.75 MMbpd after hitting a record last week.
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