DTN Oil

WASHINGTON (DTN) -- Oil futures traded on the New York Mercantile Exchange turned lower in late morning trade Wednesday, with the front-month West Texas Intermediate falling below $100 barrel (bbl) after government data from the U.S. Energy Information Administration showed an unexpected build in U.S. commercial oil inventories along with a 100,000 barrels per day (bpd) increase in domestic crude production for the week ended April 1, while a larger-than-expected drawdown in commercial gasoline inventories offset losses for the RBOB contract.

Near 11:30 a.m. EDT, NYMEX West Texas Intermediate May futures plummeted $2.84 to $99.09 bbl, and the international crude benchmark Brent June contract declined $2.70 to $104 bbl. NYMEX RBOB May futures weakened 5.44 cents to $3.1093 gallon, and the front-month ULSD futures fell 7.01 cents to $3.4033 gallon.

EIA data released at midmorning show commercial crude stockpiles climbed 2.4 million bbl from the previous week to 412.4 bbl and are now about 14% below the five-year average. The draw was bullish against expectations of a 1.6 million bbl decrease and countered estimates of a 1.080 million bbl increase by the American Petroleum Institute in data released late Tuesday afternoon.

Oil stored at Cushing, Oklahoma, the delivery point for the WTI contract rose by 1.7 million bbl from the previous week to 25.9 million bbl, EIA said in its weekly report. Domestic refiners once again increased run rates, up 0.4% from the previous week to 92.5% compared with analyst estimates for a 0.3% increase.

Oil producers, meanwhile, increased output by 100,000 bpd from the previous week to 11.7 million bpd.

In the gasoline complex, commercial inventories unexpectedly fell by 2 million bbl to 236.8 million bbl compared with analyst expectations for inventories to have decreased by 200,000 bbl from the previous week. After declining for three consecutive weeks, demand for motor gasoline in the United States gained 63,000 bpd from a three-month low 8.562 million bpd.

Distillate stocks rose 771,000 bbl from the previous week to 114.3 million bbl, and are now about 15% below the five-year average, EIA said. Analysts expected distillates inventories would fall by 200,000 bbl. Demand for distillate fuels continued lower in the reviewed week, falling by 157,000 bpd last week to a 2-1/2 month low 3.647 million bpd.

Total products supplied over the last four-week period averaged 20.4 million bpd, up 5.5% from the same period last year. Over the past four weeks, motor gasoline product supplied averaged 8.7 million bpd, down 0.3% from the same period last year. Distillate fuel product supplied averaged 3.9 million bpd over the past four weeks, up by 1.8% from the same period last year. Jet fuel product supplied was up 28.9% compared with the same four-week period last year.

Liubov Georges can be reached at liubov.georges@dtn.com