Sharp Rise in U.S. Crude Inventory

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The U.S. Energy Information Administration (EIA) released its weekly petroleum status report this morning. U.S. commercial crude inventories increased by 3.3 million barrels last week, bringing the total U.S. commercial crude inventory to 385.9 million barrels, well above the upper limit of the five-year range for this time of the year.

Total gasoline inventories decreased by 1.6 million barrels last week and remain in the middle of the five-year average range. Total motor gasoline supplied averaged more than 8.4 million barrels a day over the past four weeks — a drop of about 0.2% compared with the same period a year ago.

Distillate inventories fell by about 4.5 million barrels last week and are near the lower half of the average range. Distillate product supplied averaged about 3.8 million barrels a day over the past four weeks, up about 5.8% when compared with the same period of last year. Distillate production totaled 4.2 million barrels a day last week, down by about 100,000 barrels a day when compared with the prior week.

The American Petroleum Institute last night reported an inventory increase of 3.7 million barrels in crude supplies last week, together with a decrease of 2 million barrels in gasoline supplies and a drop of 1.9 million barrels in distillate supplies. Platts estimated a build of 1.6 million barrels in crude inventories and decreases of 1.6 million barrels for gasoline stocks and 700,000 barrels for distillate stocks. Dow Jones had projected a rise in crude inventories of 700,000 barrels.

Crude prices were down about 0.4% before the EIA report at around $95.90 a barrel, and they fell by another $0.20 immediately following the report.

For the past week, crude imports averaged more than 8.2 million barrels a day, an increase of about 841,000 barrels a day from the previous week. Refineries were running at 85.7% of capacity, with daily input of 14.9 million barrels a day, about 364,000 barrels a day more than the previous week. Refineries have increased production now that routine maintenance and the switch to summer-grade fuel reaches completion.

The United States Oil ETF (NYSEMKT: USO) is down about 0.5%, at $34.27 in a 52-week range of $29.02 to $40.29.

The United States Gasoline ETF (NYSEMKT: UGA) is down 0.2%, at $61.39, in a 52-week range of $45.13 to $65.86.