Fredericksburg Leader

hereOIL INVENTORIES POST SMALLER THAN EXPECTED RISE, EIA IMPLIED GASOLINE DEMAND SKYROCKETS

The Energy Information Administration (EIA) released its weekly report today on the status of petroleum inventories in the United States. Here are some highlights:

CRUDE OIL INVENTORIES:Crude oil inventories increased by 1.2 million barrels (MMbbl) to a total of 480.2 MMbbl. At 480.2 MMbbl, inventories are 66.8 MMbbl above last year (16.2%) and are about 9% above the five-year average for this time of year. Inventories in Cushing, OK, the NYMEX delivery point, rose 0.3 million barrels to a total of 40.7 million barrels. The Strategic Petroleum Reserve (SPR) was unchanged from the prior week and stands at 371.6 million barrels and stands 35.9% below the year ago level.

Domestic crude oil production was unchanged at 12.3 million barrels per day, 700,000 bpd higher than the year ago period. While Alaska oil production was down 2,000bpd to 445,000bpd, production in the Lower 48 was unchanged at 11.9 million barrels per day.

GASOLINE INVENTORIES:Gasoline inventories decreased by 0.9 million barrels (MMbbl) to a total of 239.2 MMbbl. At 239.2 MMbbl, inventories are down 6.8 MMbbl, or 2.8% lower than a year ago and are 5% below the five-year average for this time of year.

Here’s how individual regions and their gasoline inventory fared:

East Coast (-1.1 MMbbl)Midwest (+0.5 MMbbl)Gulf Coast (+0.2 MMbbl)Rockies (+0.1 MMbbl)West Coast (-0.6 MMbbl)It’s 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 0.2 million barrels to a total of 122.1 MMbbl. At 122.1 MMbbl, inventories are up 3.0 MMbbl, or 2.5% higher vs. a year ago. Distillate inventories stand about 10% below the five-year average for this time of year.

IMPLIED GASOLINE DEMAND:Gasoline supplied to the market amounted to 9.11 million barrels per day (MMbpd), or 202,000 bpd higher than the previous week. So far in 2023, implied gasoline demand (“products supplied”) is 1.2% lower versus 2022, per the EIA.

REFINERY OUTPUT/UTILIZATION:Refinery utilization decreased by 0.1 percentage points vs. last week’s numbers to reach 85.8%. Gasoline production increased to 9.7 million barrels per day while distillate fuel production decreased to 4.6 million barrels per day last week.

Utilization rates for the last week were as follows:

East Coast: 82.4% (+2.8%)Midwest: 91.0% (+1.2%)Gulf Coast: 86.2% (-0.5%)Rocky Mountains: 84.0% (+8.1%)West Coast: 77.8% (-3.3%)These percentages show how much of a region’s overall capacity was used to refine oil. It’s 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, you’re more likely to see gas prices rise.

OVERALL SUPPLY:Total oil stocks in the United States (excluding the SPR) are up by 103.3 MMbbl (8.9%) versus a year ago and stand at 1.259 billion barrels (excluding the Strategic Petroleum Reserve). Including the SPR, total stocks are down 105.1 million barrels (-6.1%) versus a year ago.

IMPORTS/EXPORTS:The U.S. imported 6.21 MMbpd of crude oil per day last week, down 118,000 bpd vs. the previous week, while crude oil exports rose by 1,032,000 bpd to 5.63 MMbpd. Total motor gasoline imports last week averaged 672,000 bpd. The U.S. also imported 197,000 bpd of distillate fuels. However, during the same timeframe, the U.S. exported 651,000 bpd of finished gasoline and 945,000 bpd of distillates. In total, U.S. companies exported 11.13 MMbpd of oil and petroleum products.

Before the report was released, the price of West Texas Intermediate crude oil was down 81 cents to $76.24 per barrel. Just after the report was released, oil was down 11 cents per barrel.

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