Crude oil inventories rose 0.1 million barrels in the June 23 week to 509.2 million, 2.7 percent above the year ago level. Product inventories fell, with gasoline down 0.9 million barrels to 241.0 million, up 0.8 percent from last year at this time, and distillates down 0.2 million barrels to 152.3 million, 1.2 percent from above the level a year ago. The marginal build was a surprise to most analysts, who expected a drawdown of more than 2 million barrels in the week, though the American Petroleum Institute yesterday afternoon reported an even larger build of 0.851 million barrels. WTI crude oil prices rose in a relief rally immediately following the release of the EIA report, rising about 40 cents to around $44.50 per barrel.
Crude oil imports rose 140,000 barrels per day in the week to an average of 8.0 million barrels per day. Over the last four weeks, crude oil imports averaged 8.1 million barrels per day, up 3.00 percent from last year.
Refineries operated at 92.5 percent of their operable capacity during the week, down 1.5 percentage points from the prior week, but gasoline production increased to an average of 10.3 million barrels per day, while distillate production fell, averaging 5.2 million barrels per day.
Product demand resumed its decline, with product supplied over the last four weeks averaging 19.9 million barrels, 2.7 percent below the level during the same period last year. Motor gasoline supplied averaged 9.5 million barrels per day, down 2.4 percent from the same period last year, while distillate fuel product supplied averaged 3.9 million barrels per day, up 2.9 percent from the same period last year.
Though the drawdown in product inventories gives some relief support to prices that have been hammered down by oversupply worries in recent weeks, persistent demand weakness seen again in today's report only magnifies the impression given by larger inventories and a rising rig count indicating future North American production growth.