U.S. crude oil stockpiles rose last week for a seventh straight week but less than forecast, while gasoline inventories fell far more than expected as refineries cut output, the Energy Information Administration (EIA) said Feb. 23.
Crude inventories rose 564,000 barrels (Mbbl) in the week to Feb. 17, compared with analysts' expectations for an increase of 3.5 MMbbl, in spite of a 1.4 MMbbl/d slump in imports.
Oil prices initially rose on the data that bullishly showed hefty product drawdowns and a sharp 1.5 MMbbl drop in crude stocks at the Cushing, Okla., delivery hub for U.S. crude futures.
By 10:39 a.m. CT (16:39 GMT) or half an hour after the report, however, West Texas Intermediate crude futures pared gains to 1.5% at $54.40/bbl.
"It's surprising that the market didn't move very much today even with the draw from Cushing. We saw some bigger draws in heating oil and even gasoline, but we're well supplied there," said Tariq Zahir at Tyche Capital Advisors.
Crude oil and gasoline inventories had soared to record highs a week earlier as refineries cut output amid seasonal maintenance and gasoline demand softened.
Refinery crude runs continued to decline, slipping by 187 Mbbl/d last week as utilization rates fell 1.1 percentage points to 84.3% of total refining capacity, EIA data showed.
U.S. East Coast refinery utilization rates dropped to 72.4%, the lowest seasonal level since 2015, the EIA said.
Gasoline stocks fell 2.6 MMbbl, compared with analysts' expectations in a Reuters poll for an 888 Mbbl drop.
Gasoline is seeing "remarkable weakness" and some of that was due to the weather conditions on the West Coast, one of the biggest consumers of gasoline in the world, said John Kilduff, partner at New York energy hedge fund Again Capital.
Distillate stockpiles, which include diesel and heating oil, fell 4.9 MMbbl, vs. forecasts for a 483 Mbbl draw, the EIA data showed. That was the largest weekly drop since October, 2014.
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