U.S. Oil, Distillate Stocks Shrink - Analyst Blog


The U.S. Energy Department's weekly inventory release showed that crude inventories moved down, while gasoline stocks added to their supplies. The agency's report further revealed that distillate stockpiles declined for the seventh-straight week. Meanwhile, refiners improved processing rates by 2.2%.

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 abroad.

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 ExxonMobil ( XOM ), Chevron Corp. ( CVX ), ConocoPhillips ( COP ), Valero ( VLO ) and Tesoro ( TSO ).

Crude Oil

The federal government's EIA report revealed that crude inventories shrank by 1.06 million barrels for the week ending November 11, 2011, the second straight weekly decline.

Analysts surveyed by Platts, the energy information arm of McGraw-Hill Companies Inc. ( MHP ), had expected oil stocks to go down some 1.5 million barrels. A rise in refinery utilization and lower imports led to the dip in stockpile with the world's biggest oil consumer.

However, crude inventories at the Cushing terminal in Oklahoma - the key delivery hub for U.S. crude futures - grew by 890,000 barrels from last week's level to 32.0 million barrels. Stocks reached an all-time high of 41.90 million barrels earlier this year.

At 337.03 million barrels, current crude supplies are 5.8% lower than the year-earlier level, but are in the upper limit of the average for this time of the year. The crude supply cover was down from 23.3 days in the previous week to 23.1 days. In the year-ago period, the supply cover was 25.4 days.


Supplies of gasoline increased for the second time in three weeks on the back of improved production, higher import levels and weaker demand. The 992,000 barrels-build - against projections for a drawdown - took gasoline stockpiles up to 205.16 million barrels. The existing inventory level is 1.2% below the year-earlier levels and in the middle of the average range.


Distillate fuel inventories (including diesel and heating oil) were down by 2.14 million barrels last week, compared with analyst expectations for a much larger fall. The decrease in distillate fuel supplies - for the seventh consecutive week - could be due to lower imports, partly offset by higher production and weaker demand.

At 133.73 million barrels, distillate supplies are 15.8% below than the year-ago level and are in the lower boundary of the average range at this time of the year.

Refinery Rates

Refinery utilization was up 2.2% from the prior week to 84.8%. Analysts were expecting the refinery run rate to increase 0.3%.

CONOCOPHILLIPS ( COP ): Free Stock Analysis Report
CHEVRON CORP ( CVX ): Free Stock Analysis Report

MCGRAW-HILL COS ( MHP ): Free Stock Analysis Report
TESORO CORP ( TSO ): Free Stock Analysis Report
VALERO ENERGY ( VLO ): Free Stock Analysis Report
EXXON MOBIL CRP (XOM): Free Stock Analysis Report
Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ, Inc.

This article appears in: Investing , Business , Stocks

Referenced Stocks: COP , CVX , MHP , TSO , VLO



More from Zacks.com:

Related Videos



Most Active by Volume

    $15.75 unch
  • $27.18 ▲ 4.70%
  • $109.50 ▼ 1.16%
  • $13.46 ▲ 3.46%
  • $28.03 ▲ 0.94%
  • $106.05 ▲ 0.40%
  • $24.15 ▼ 5.96%
  • $114.93 ▲ 6.32%
As of 10/8/2015, 04:04 PM

Find a Credit Card

Select a credit card product by:
Select an offer:
Data Provided by BankRate.com