Market Report & Analysis for 5/25/2018 Afternoon Edition

Afternoon Market Overview

This week’s EIA report was overall bearish based on total combined crude oil and refined product inventories decreasing for the week. Total combined stocks are now 167.7 million bbls below the record high hit at the end of the first week of February of 2017.

The EIA reported a build in crude oil and in gasoline with distillate fuel stocks declining. Total US crude oil production increased slightly after increasing during the previous week. Total US production remains above the average annual high hit in 1970 and above the average monthly record high hit in October 1970 of 10.013 million bpd. Total US crude oil stocks increased after decreasing during the previous week even as refinery run rates increased but crude oil imports increased strongly with a strong decrease in crude oil exports.

Total crude stocks increased by 5.7 million barrels. Total commercial stocks of crude oil and refined products were higher by 6.8 million bbls after decreasing during the previous week. The year over year deficit came in at 143.9 million barrels while the deficit versus the five- year average for the same week came in at 11.3 million barrels.

Total combined stocks of crude and refined products have been decreasing for the last few months and are still 167.6 million bbls off their record high level. Distillate stocks decreased by 0.9 million bbls versus the market expectations for a larger draw as total US refinery runs increased to 91.1 percent of capacity with exports increasing strongly on the week. The year over year comparison shows current stock levels at about 32.3 million barrels below last year.

The five-year average deficit came in around 27.1 million barrels. Gasoline inventories increased by 1.9 million bbls and are still off the record high level hit early in 2017. The deficit versus last year came in around 6 million barrels while the surplus versus the five-year average for the same week came in at 6.3 million barrels.