U.S. crude oil stocks posted the biggest weekly build in nearly two years last week as production hit a new record high and the government released more barrels from its reserve, the Energy Information Administration (EIA) said Nov. 15.
Crude inventories soared 10.3 million barrels in the week to Nov. 9 to 442.1 million barrels, the highest level since early December 2017, compared with analysts' expectations for an increase of 3.2 million barrels. That was the biggest weekly increase since February 2017.
U.S. crude production also climbed by 100,000 barrels per day (bbl/d) to 11.7 million bbl/d, the highest on record, while net U.S. crude imports rose 268,000 bbl/d, the data showed.
"A good chunk of the crude build occurred on the Gulf Coast, as refining activity dropped," said Matt Smith, director of commodity research at ClipperData, referring to the region's 5.2 million-barrel build.
"Common themes are threaded through this report as in recent weeks—another SPR release and another increase to domestic production."
The U.S. Department of Energy had offered about 11 million barrels of oil for sale from the nation's Strategic Petroleum Reserve (SPR), to be delivered between Oct. 1 through Nov. 30 and those barrels have now been arriving in the market, traders said.
Inventories in the SPR dropped by about 1.4 million barrels last week to the lowest level since 2004, according to EIA data.
Oil prices, however, held gains after the bearish build in crude as the market focused instead on the decline in fuel stockpiles.
"Obviously the headline crude build was shocking but the market is not falling apart in part due to the fact that we saw big drops in gasoline supplies ... and distillate fuels. The products are definitely supporting us right now, said Phil Flynn, analyst at Price Futures Group in Chicago.
Gasoline stocks fell by 1.4 million barrels, compared with analysts' expectations in a Reuters poll for a 1.5 million-barrel drop.
Distillate stockpiles, which include diesel and heating oil, fell by 3.6 million barrels, vs. expectations for a 1.7 million-barrel drop, the EIA data showed.
Crude stocks at the Cushing, Okla., delivery hub rose by 1.17 million barrels, EIA said.
Refinery crude runs rose by 24,000 bbl/d, EIA data showed. Refinery utilization rates rose by 0.1 percentage point to 90.1% of total capacity.
Recommended Reading
Aramco Reports Second Highest Net Income for 2023
2024-03-15 - The year-on-year decline was due to lower crude oil prices and volumes sold and lower refining and chemicals margins.
Baker Hughes Awarded Saudi Pipeline Technology Contract
2024-04-23 - Baker Hughes will supply centrifugal compressors for Saudi Arabia’s new pipeline system, which aims to increase gas distribution across the kingdom and reduce carbon emissions
Valaris’ 1Q Sets Positive Tone for Offshore
2024-05-06 - Coming out of first-quarter 2024, drilling contractor Valaris expects a sustained upcycle for the offshore drilling industry supported by demand growth, OPEC+ production cuts and supportive commodity prices.
President: Financial Debt for Mexico's Pemex Totaled $106.8B End of 2023
2024-02-21 - President Andres Manuel Lopez Obrador revealed the debt data in a chart from a presentation on Pemex at a government press conference.
Oil and Gas Chain Reaction: E&P M&A Begets OFS Consolidation
2024-04-26 - Record-breaking E&P consolidation is rippling into oilfield services, with much more M&A on the way.