Afternoon Market Overview

This week’s EIA report was overall bearish based on total combined crude oil and refined product inventories increasing for the week.

Total combined stocks are now 168.4 million bbls below the record high hit at the end of the first week of February of 2017. The EIA reported a draw in crude oil and gasoline with a build in distillate fuel stocks. Total US crude oil production increased after increasing during the previous week. Total US production is well above the average annual high hit in 1970 and above the average monthly record high hit in October of 1970 of 10.013 million bpd. Total US crude oil production is now 888,000 bpd above the average annual record high in 1970 and 512,000 above the record monthly high in October of 1970.

Total US crude oil production is about 14.72 percent above where it was for the same week a year ago. This week’s production came in at 10.460 million bpd. Total US crude oil stocks increased after increasing during the previous week even as refinery run rates increased but crude oil imports increased strongly. Total commercial stocks of crude oil and refined products were higher by 5.9 million bbls after declining during the previous week. The year over year deficit came in at 141.2 million barrels while the surplus versus the five- year average for the same week came in at 9.5 million barrels.

Total combined stocks of crude and refined products have been decreasing for the last few months and are now 168.4 million bbls off their record high level. Total crude oil inventories increased as total crude oil exports decreased strongly while imports increased strongly. Total crude stocks increased by 3.3 million barrels. With the increase in crude oil stocks this week the crude oil inventory status versus last year is showing a deficit of 104.8 million barrels while the deficit versus the five-year average for the same week came in around 10.2 million barrels.

Distillate stocks decreased by 1.1 million bbls versus the market expectations for a smaller draw even as total US refinery runs increased to 93.5 percent of capacity, with exports increasing modestly on the week. The year over year comparison shows current stock levels at about 21.8 million barrels below last year. The five-year average deficit came in around 12.7 million barrels.

Gasoline inventories increased by 0.4 million bbls and are still off the record high level hit early in 2017. The surplus versus last year came in around 2.8 million barrels while the surplus versus the five-year average for the same week came in at 10.3 million barrels.