RBOB Futures Extend Decline

Brian L Milne
By  Brian L. Milne , DTN Refined Fuels Editor

CRANBURY, N.J. (DTN) -- Oil futures nearest to delivery traded on the New York Mercantile Exchange were mixed with a downside bias following the midmorning release of weekly oil statistics from the Energy Information Administration, with the RBOB contract adding to an overnight decline on an unexpected supply build.

The EIA report was directionally in line with weekly data released late Tuesday afternoon by the American Petroleum Institute, while an EIA-reported 1.2 million bbl build in gasoline supply contrasted with market expectations for a supply draw of about 1.0 million bbl.

The gasoline supply build coincided with flat growth in demand at 9.09 million bpd, up 8,000 bpd during the week-ended April 27, while gasoline production jumped 159,000 bpd to 10.045 million bpd. Gasoline imports also increased, up 27,000 bpd to a 923,000 bpd seven-month high. The additional supply gains outpaced an 110,000 bpd boost in gasoline exports to 901,000 bpd.

U.S. commercial crude stocks increased well above expectations, with EIA reporting a 6.2 million bbl build during the week-ended April 27. The build came alongside a 33,000 bpd increase in domestic crude production to a fresh record high of 10.619 million bpd, closing in on EIA's outlook for U.S. crude output to average 10.7 million bpd this year. The supply build came as refinery crude inputs eased for the fourth consecutive week, down 60,000 bpd to a 16.561 million bpd seven-week low.

U.S. crude exports remained strong at 2.148 million bpd during the week profiled, easing 183,000 bpd from a record high, although the third highest export rate on record.

Data for distillate fuel was bullish, with stocks drawn down a more-than-expected 3.9 million bbl to 118.8 million bpd during the week-ended April 27, with inventory at a 41-month low. Implied distillate demand surged 736,000 bpd to 4.485 million bpd, the highest weekly demand rate since the second week of 2018.

In late morning trade, NYMEX June West Texas Intermediate futures were little changed near $67.25 bbl, while June ULSD futures were up $0.0025 at $2.1022 gallon. June RBOB futures were down $0.0020 at about $2.0675 gallon, trading near a $2.0617 gallon two-week spot low.

Brian Milne can be reached at brian.milne@dtn.com


Brian Milne