The U.S. Energy Department's weekly inventory release showed
that crude stockpiles fell from their 22-year high levels, as
imports declined and refinery activity rose. The agency's report
further revealed that within the 'refined products' category,
gasoline stocks soared, while distillate supplies plummeted.
The Energy Information Administration (EIA) Petroleum Status
Report, which contains data for the previous week ending Friday,
outlines information regarding the weekly change in petroleum
inventories held and produced by the U.S., both locally and
The report provides an overview of the level of reserves and
their movements, thereby helping investors understand the
demand/supply dynamics of petroleum products. It is an indicator of
current oil prices and volatility that affect businesses of
companies engaged in the oil and refining industry, such as
Valero Energy Corp.
Analysis of the Data
The federal government's EIA report revealed that crude inventories
fell by 133,000 barrels for the week ending June 22, 2012, after
climbing by 2.86 million barrels the week before.
Analysts surveyed by Platts, the energy information arm of
McGraw-Hill Companies Inc.
), had expected oil stocks to go down some 1 million barrels. A
decline in the level of imports and sharply higher refinery
activity led to the stockpile drawdown with the world's biggest oil
In particular, crude inventories at the Cushing terminal in
Oklahoma - the key delivery hub for U.S. crude futures traded on
the New York Mercantile Exchange - decreased by 339,000 barrels
from previous week's level to 47.42 million barrels. Stocks are
just under the all-time high of 47.78 million barrels reached
earlier in June.
At 387.17 million barrels, current crude supplies are 7.7% above
the year-earlier level, and are over the upper limit of the average
for this time of the year. The crude supply cover was down from
25.0 days in the previous week to 24.8 days. In the year-ago
period, the supply cover was 23.8 days.
Supplies of gasoline increased for the third time in 4 weeks
despite domestic consumption edging up 1.8% to 8.85 million barrels
a day. The rise in gasoline inventories could be attributed to
The 2.08 million barrels gain - compared to analyst projections
for a 300,000 barrels hike in supply level - took gasoline
stockpiles up to 204.82 million barrels. Notwithstanding this
increase, existing inventory level of the most widely used
petroleum product is still 3.9% below the year-earlier levels and
is in the lower limit of the average range.
Distillate fuel supplies (including diesel and heating oil)
decreased by 2.28 million barrels last week, contrary to analyst
expectations for a 1 million barrel build. The fall in distillate
fuel stocks - the second decline in 3 weeks - could be attributed
to stronger demand.
At 118.85 million barrels, distillate supplies are 16.4% below
the year-ago level and are under the lower limit of the average
range for this time of the year.
Refinery utilization was up 0.7% from the prior week at 92.6%.
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