Oil Futures Lower After EIA Report

OLD BRIDGE, N.J. (DTN) -- Oil futures nearest to delivery traded on the New York Mercantile Exchange and Brent crude on the Intercontinental Exchange continued mostly lower following Thursday's release of weekly supply data from the Energy Information Administration, showing a more-than-expected draw in commercial crude supply and unexpected builds in gasoline and distillate inventories during the week leading up to the Memorial Day weekend.

NYMEX July West Texas Intermediate futures continued lower versus early session values, as U.S. oil production increased a robust 44,000 bpd to a fresh record high output rate of 10.769 million bpd during the week-ended May 25.

EIA showed a 3.6 million bbl draw in commercial crude inventories to 434.5 million bbl occurred last week that contrasted with a 1.0 million bbl build reported by American Petroleum Institute late Wednesday afternoon. The EIA data compares with a 5.8 million bbl build reported for the previous week.

The decline in commercial crude stocks came with a boost in refiner demand, with crude inputs up 527,000 bpd to 17.155 million bpd, the highest input rate since the beginning of the year. Crude imports at 7.631 million bpd during the week reviewed are down 528,000 bpd from prior week, while holding below the year-to-date average of 7.87 million bpd.

EIA reported 500,000 bbl build in gasoline inventories to 234.4 million bbl compared with a 1.9 million bbl build the prior week, though still off 1.1% or 2.6 million bbl from the equivalent period in 2017. The build contrasted with an API reported 1.682 million bbl draw for the week reviewed.

Distillate fuel supply edged up on the week, posting a 600,000 bbl build to 114.6 million bbl, though still off 32.1 million bbl or 21.9% from 2017, when 146.7 million bbl were in inventory. The build was less than an API-reported 1.47 million bbl build.

In late morning trade, NYMEX July WTI futures were down about 76cts to $67.45 bbl, with ICE July Brent 15 cents higher at $77.65 bbl. NYMEX June ULSD futures were down 1.7 cents to $2.2140 gallon, with the June RBOB contract was off fractionally to $2.1793 gallon.

Brian Whary can be reached at brian.whary@dtn.com