The Energy Information Administration released its weekly report on the condition of petroleum inventories in the United States today.
Here are some highlights:
Crude oil inventories decreased by 6.7 million barrels to a total of 346.4 million barrels. At 346.4 million barrels, inventories are 11.0 million barrels below last year (-3.1%) and are above average.
Gasoline inventories increased by 1.9 million barrels to 210.8 million barrels. At 210.8 million barrels, inventories are now 13.7 million barrels, or 6.1% lower than last year (last week that number was 7.2% lower). Regions posting gains in inventories last week were the East Coast (+0.7mb), Gulf Coast (+1.0mb), and West Coast (+0.6mb). Decreases were seen in the Midwest (-0.2mb) and the Rockies (-0.2mb). It is important to note which regions saw increases/decreases as this information likely drives prices up (in the case of falling inventories), or down (in the case of rising inventories).
DISTILLATE (diesel, heating oil) INVENTORIES:
Distillate inventories increased by 1.7 million barrels to a total of 158.5 million barrels. At 158.5 million barrels, inventories are now 9.2% lower than a year ago. Distillate inventories are 16.0 million barrels lower than their year ago level.
Refinery utilization hit 87.0%, a drop of 2.0% vs. last week's numbers. Gasoline production increased last week to 9.4 million barrels per day while distillate fuel production averaged 4.5 million barrels per day, a decrease over the prior week.
Refineries in the Midwest PADD operated at the highest utilization- some 91.3% of capacity. Refiners in the Gulf Coast PADD came in second at 87.9% while refiners in the West Coast PADD came in third with 86.4%. East Coast refiners took the position of utilizing the lowest percentage of their plants last week, edging out the Rockies. Rockies plants ran at 80.2% of their capacity while East Coast plants ran 75.5% of their available capacity, likely because of Hurricane Irene related shutdowns. It is important to note these percentages, because the lower the utilization percent, the lower output, which has a direct impact on local gasoline prices. If refiners in your region have low output, your more likely to see prices rise.
Total oil stocks in the United States are down 57.3 million barrels (-5.0%) over last year and stand at 1.083 billion barrels (excluding the Strategic Petroleum Reserve).
It is notable that the Strategic Petroleum Reserve continues to drop, declining 1.0 million barrels to 695.9 million barrels from its peak at 726.5 million barrels.
The U.S. imported 597,000 barrels per day of gasoline and 152,000bpd of distillate fuels. However, during the same time frame, the U.S. exported 395,000bpd of gasoline and 745,000bpd of distillates. In total, U.S. refineries exported 2.4 million barrels per DAY of oil and products!
Overall, crude saw a large decline which ultimately may drive the market and may outweigh increases in gasoline and distillate. However, with autumn months coming, an increase in gasoline and distillate may drive products lower as it may be a sign of things to come. Hurricane season is quiet at the moment, and there are still economic jitters. While this report would have been much better without a massive decline in crude, it still shows finished product supply rising, which is good news.