Crude oil inventories rose by 1.9 million barrels in the November 10 week to 459.0 million, 6.4 percent below the level a year ago. Product inventories were mixed, with gasoline up 0.9 million barrels to 210.4 million, 5.1 percent below last year's level, but distillates down 0.8 million barrels to 124.8 million, a year-on-year decline of 15.3 percent. The rise in crude oil inventories reported by the EIA was much smaller than the 6.5 million barrel increase reported yesterday to subscribers by the American Petroleum Institute (API), a private industry group. WTI prices, which had been under pressure subsequent to the API data, fell another 20 cents to around $54.90 per barrel immediately following the release of the EIA report but quickly bounced back to around $55.30.
Refineries ramped up operation by another 1.4 percentage points during the week to 91.0 percent of their operable capacity. Gasoline production nevertheless declined, averaging about 9.9 million barrels per day. Distillate production rose slightly, averaging 5.2 million barrels per day.
Crude oil imports rose, averaging 7.9 million barrels per day, up 521,000 barrels per day from the prior week. The 4-week daily average rose to 7.7 million barrels, 2.8 percent less than in the same period last year.
The demand side continues to strengthen and is finally in positive year-on-year territory, with total product supplied over the last four week averaging 20.1 million barrels per day, up 0.5 percent from last year and a 1.3 percentage point improvement on last week's reading. Gasoline supplied averaged 9.4 million barrels per day, up 1.5 percent from the same period last year. Distillate supplied averaged 4.0 million barrels per day, 0.8 percent higher than last year at this time.
Despite the second consecutive weekly increase in crude stocks, the balanced picture in product inventories and the continued strengthening on the demand side shows the previously imbalanced supply-demand situation stabilizing. However, current prices near 2-year highs are bound to stimulate new exploration and development activities, increasing domestic production and supply down the road.