July 5, 2018
(Reuters) – U.S. crude oil stockpiles unexpectedly rose last week ,as imports grew and refineries cut output while gasoline inventories decreased nearly double forecasts, the Energy Information Administration said on Thursday.
Crude inventories rose 1.2 million barrels in the week to June 29, compared with analysts’ expectations for a decrease of 3.5 million barrels.
Oil prices dropped on the news, in part because the figures were the inverse of the drop in inventories shown by industry group the American Petroleum Institute on Tuesday.
U.S. crude futures dropped 90 cents, or 1.2 percent, to $73.22 per barrel as of 11:18 a.m. EST (1518 GMT). Brent crude lost 38 cents to $77.84 a barrel.
“The headline number caught people by surprise and leaning a little bit. And that’s the reason for the big downward reaction,” said Phil Flynn, trader at Price Futures Group in Chicago.
Crude stocks at the Cushing, Oklahoma, delivery hub for futures fell heavily by 2.1 million barrels, EIA said, dropping overall inventories at the key storage hub to their lowest level since 2014. The recent declines in Cushing are in part due to the outage at a Syncrude facility in Canada, limiting the flows into the Oklahoma hub.
Net U.S. crude imports rose last week by 1.4 million barrels per day. U.S. production remained steady at 10.9 million bpd for a third week in a row.
Refinery crude runs fell by 163,000 bpd, EIA data showed. Refinery utilization rates fell by 0.4 percentage point to 97.1 percent of total capacity.
Gasoline stocks fell 1.5 million barrels, compared with expectations in a Reuters poll for a 817,000-barrel drop.
Distillate stockpiles, which include diesel and heating oil, rose by 134,000 barrels, versus expectations for a 545,000-barrel drop, the EIA data showed.
Reporting By David Gaffen; additional reporting by Stephanie Kelly; Editing by Marguerita Choy