U.S. oil prices fell on Wednesday after federal data showed a sharp crude draw in US crude oil inventories but large builds in gasoline and distillate inventories, highlighting uneven fuel demand and ample refined supplies despite high refinery use.
Crude Stocks Fall Below Seasonal Norms
Oil Slips as EIA Data Shows US Crude Oil Inventories Fall, Fuel Builds
US crude oil inventories dropped by 3.8 million barrels in the week ending Jan. 2, the Energy Information Administration reported Wednesday. Stockpiles, excluding the Strategic Petroleum Reserve, totaled 419.1 million barrels and remained about three percent below the five-year average.
In its weekly report, the EIA said “commercial crude oil inventories fell by 3.8 million barrels,” a larger decline than industry estimates earlier in the week. The American Petroleum Institute had projected a smaller draw in its preliminary data.
Crude imports rose sharply, averaging 6.3 million barrels per day, up 1.4 million barrels per day from the prior week. Over the past four weeks, imports averaged about 6.0 million barrels per day, down 9.7 percent from the same period last year.
Gasoline, Distillate Inventories Post Big Builds
While crude supplies tightened, refined fuel inventories surged. Motor gasoline stocks rose by 7.7 million barrels and now sit about three percent above the five-year average, according to the EIA.
Finished gasoline inventories declined, but blending components increased, reflecting seasonal shifts in production. Distillate fuel inventories climbed by 5.6 million barrels, though they remain about 43 percent below the five-year average, signaling continued tightness in heating fuel supplies.
The EIA said “distillate fuel inventories increased by 5.6 million barrels,” confirming the trend seen in earlier industry data. Propane and propylene inventories fell by 2.2 million barrels but stayed roughly 29 percent above seasonal norms.
Total commercial petroleum inventories rose by 8.1 million barrels last week, underscoring the contrast between falling crude stocks and rising refined product supplies.
Refinery Runs Rise as Prices Slide
Refinery activity edged higher, with crude inputs averaging 16.9 million barrels per day, up 62,000 barrels per day from the previous week. Refineries operated at 94.7 percent of operable capacity, near winter highs.
Gasoline production slipped to an average of 9.0 million barrels per day, while distillate fuel production rose by 81,000 barrels per day to 5.3 million barrels per day. Total motor gasoline imports averaged 549,000 barrels per day, and distillate imports averaged 207,000 barrels per day.
Over the past four weeks, total products supplied averaged 19.9 million barrels per day, down 1.9 percent from the same period last year. Motor gasoline demand edged up 0.5 percent, while distillate and jet fuel demand fell by 4.3 percent and 1.9 percent, respectively.
Oil prices weakened after the report. At 11:49 a.m. On Wednesday, West Texas Intermediate traded at $56.29 a barrel, down $0.84, or 1.47 percent. US crude oil inventories fell $0.54, or 0.89 percent, to $60.16 a barrel.
