The U.S. Energy Department's weekly inventory release showed
that crude stockpiles went up, as imports jumped and refiners
scaled down their utilization rates. The report further revealed
that within the 'refined products' category, gasoline stocks
rose, while distillate supplies were down from the week-ago
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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 jumped by 2.52 million barrels for the week ending
Jun 07, 2013, following a decrease of 6.27 million barrels in the
The analysts surveyed by Platts - the energy information arm of
McGraw-Hill Financial Inc.
) - had expected crude stocks to remain unchanged. A sharp uptick
in the level of imports and drop in refinery utilization rates
led to the stockpile build-up with the world's biggest oil
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 759,000 barrels from the
previous week's level to 49.27 million barrels. Stocks are
currently just under the all-time high of 51.86 million barrels
reached in Jan.
Following the weekly inventory increase, at 393.81 million
barrels, current crude supplies are 2.4% above the year-earlier
level, and exceeds the upper limit of the average for this time
of the year. The crude supply cover was up marginally from 25.7
days in the previous week to 25.8 days. In the year-ago period,
the supply cover was 25.1 days.
Supplies of gasoline were up for the first time in 3 many weeks,
as domestic consumption weakened and imports spiked. This was
partially offset by lower production.
The 2.75 million barrels gain - significantly ahead of analysts'
projections for a 1 million-barrels increase in supply level -
took gasoline stockpiles up to 221.55 million barrels. Following
this build, the existing inventory level of the most widely used
petroleum product is 9.8% 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 1.16 million barrels last week, contrary to analysts'
expectations for a 1.4 million barrels build in inventory level.
The decrease in distillate fuel stocks - the first in 3 weeks -
could be attributed to stronger demand, lower imports and decline
At 122.11 million barrels, distillate supplies are 1.8% above the
year-ago level but are in the lower limit of the average range
for this time of the year.
Refinery utilization was down 0.9% from the prior week to 87.5%.
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).