The U.S. Energy Department's weekly inventory release showed
that crude stockpiles went up, as imports jumped. The report
further revealed that within the 'refined products' category,
gasoline stocks rose, while distillate supplies were down from
the week-ago level. Meanwhile, refiners scaled up their
utilization rates by 1.8%.
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The Energy Information Administration (EIA) Petroleum Status
Report, containing data of 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 the businesses
of the companies engaged in the oil and refining industry.
Analysis of the Data
The federal government's EIA report revealed that crude
inventories edged up by 313,000 barrels for the week ending Jun
14, 2013, following a jump of 2.52 million barrels in the
The analysts surveyed by Platts - the energy information arm of
McGraw-Hill Financial Inc.
) - had expected crude stocks to go down some 1 million barrels.
A sharp uptick in the level of imports led to the surprise
stockpile build-up with the world's biggest oil consumer even as
refiners improved their utilization rates and production pulled
However, crude inventories at the Cushing terminal in Oklahoma -
the key delivery hub for U.S. crude futures traded on the New
York Mercantile Exchange - were down 669,000 barrels from the
previous week's level to 48.60 million barrels, the lowest
year-to-date. Stocks are currently 6.3% under the all-time high
of 51.86 million barrels reached in Jan.
Following the weekly inventory increase, at 394.12 million
barrels, current crude supplies are 1.8% above the year-earlier
level, and exceeds the upper limit of the average for this time
of the year. The crude supply cover was down marginally from 25.8
days in the previous week to 25.7 days. In the year-ago period,
the supply cover was 25.0days.
Supplies of gasoline were up for the second time in as many weeks
despite a rise in domestic consumption as well as lower imports
and production. The spike in gasoline inventories was mainly
concentrated in the West Coast and in the Midwest.
The 183,000 barrels gain - significantly below the analysts'
projections for a 1.2 million-barrels increase in supply level -
took gasoline stockpiles up to 221.73 million barrels. Following
this build, the existing inventory level of the most widely used
petroleum product is 9.4% higher than the year-earlier level and
is above the top half of the average range.
Distillate fuel supplies (including diesel and heating oil) were
down 489,000 barrels last week, contrary to analysts'
expectations for a 300,000 barrels build in inventory level. The
decrease in distillate fuel stocks - the second in successive
weeks - could be attributed to slightly lower production,
partially offset by weaker demand and increase in imports.
At 121.62 million barrels, distillate supplies are 0.4% above the
year-ago level but is in the lower limit of the average range for
this time of the year.
Refinery utilization was up 1.8% from the prior week to 89.3%.
The analysts were expecting the refinery run rate to increase
1.0% to 88.5%.
A bullish data from the EIA generally acts as a positive catalyst
for crude prices and buoy producers, such as
Exxon Mobil Corp.
). With an improvement in the companies' ability to generate
positive earnings surprises, they can then move higher from their
current Zacks Rank #3 (Hold).