WASHINGTON (DTN) -- Oil futures on the New York Mercantile Exchange and the Brent contract on the Intercontinental Exchange were little changed in afternoon trade Wednesday. The ULSD contract declined after government data showed another buildup in product supply and smaller-than-expected drawdown in crude inventories during the week ended Dec. 13, while midafternoon losses were offset by expectations for a higher oil demand growth next year on the back of progress in the U.S.-China trade row.
NYMEX January West Texas Intermediate futures ended the session at $60.93 barreld (bbl) ahead of contract expiration on Thursday, with next-month delivery February futures closing down at an $0.08 discount to the expiring contract. ICE February Brent settled up $0.07 at $66.17 bbl, a fresh three-month high on the spot continuous chart.
NYMEX January ULSD futures fell 1.31 cents to $2.0203 gallon and the January RBOB contract dipped 0.19 cents to a $1.6838 gallon.
Crude futures trimmed earlier declines after government data reported U.S. oil supply decreased 1.1 million bbl last week that was bullish against a 4.7 million bbl increase reported late Tuesday by the American Petroleum Institute, but missed market calls for a larger drawdown. At 446.8 million bbl, U.S. commercial oil inventories remain 4% above the five-year average.
Surprisingly, the refinery run rate remained unchanged at 90.4% of capacity during the week ended Dec. 13, while crude input slipped 35,000 barrels per day (bpd) to 16.6 million bpd, 5% below the comparable week a year ago.
Despite the seasonally low refinery rate products supply increased, with gasoline inventory up 2.5 million bbl and distillate stocks 1.5 million bbl higher on the week. Days of forward distillate supply expanded 0.8 days to 31.7 days during the week ended Dec. 13, a ten week high, while widening to 3 days above year ago.
The year-on-year supply disposition for distillate fuel quickly changed in December. Days of supply were below year ago from early October to the end of November when they were down 2 days against the end of November 2018. In December, days of forward supply increased 3.3 days while a year ago they fell 1.7 days during the comparable two-week period.
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