DOE Crude & Gasoline Inventories Meet High Refining Capacity (USO, UGA, PSX, VLO, OIH)

Crude oil inventories fell by only 111,000 to 384.629 million barrels.  Dow Jones was calling for -500,000 and we were told to look for an even larger drop. United States Oil (AMEX: USO) is up 1.8% at $32.34 against a 52-week range of $29.10 to $42.30.

Gasoline stocks posted a large gain of 3.346 million barrels in the last week to 203.525 million barrels.  Dow Jones was expecting a gain of 400,000 and we were expecting only a tad larger than Dow Jones.  United States Gasoline (AMEX: UGA) is now up 0.7% at $48.70 angainst a 52-week range of $44.65 to $58.88.

Distillates rose by 2.253 million barrels to 120.037 million barrels, but we do not track estimates on this measure.

Perhaps the biggest news is the major refining capacity number. This came in at a whopping 91.0%, and that is up from 89.1% a week earlier and up from the Dow Jones target of 89.6%. Is this a signal that the recent drop in oil prices has made refining very profitable again? Phillips 66 (NYSE: PSX) is up 3% at $30.81 and Valero Energy Corporation (NYSE: VLO) is up 3.6% at $21.75 on the news.

Market Vectors Oil Services ETF (AMEX: OIH) is now up 2.4% at $35.56 against a 52-week range of $33.57 to $45.14.

JON C. OGG