DTN Oil

WASHINGTON (DTN) -- Oil futures nearest delivery on the New York Mercantile Exchange strengthened in late morning trade Wednesday, with West Texas Intermediate climbing back above $90 barrel (bbl) after weekly inventory report from the Energy Information Administration showed across-the-board draws from U.S. petroleum stockpiles in the week ended Feb. 4, while refiners boosted crude throughputs to meet stronger fuel demand.

Near 11:30 a.m. EST, front-month WTI futures advanced $0.91 bbl to $90.27. NYMEX March RBOB futures rallied 4.46 cents to $2.6709 gallon, and front-month ULSD futures gained more than 3 cents to $2.8236 gallon.

U.S. commercial crude oil inventories unexpectedly decreased by 4.8 million bbl from the previous week to 410.4 million bbl and are now about 10% below the five-year average. The crude draw was bullish against expectations for a 500,000 bbl build and 2.5 million bbl drop reported by the American Petroleum Institute late Tuesday. The draw was realized as domestic refiners increased run rates by 1.5% from the previous week to 88.2% -- the highest weekly run rate since the first week of January. In the reviewed week, refiners processed an average 15.5 million bbl of crude each day, some 329,000 barrels per day (bpd) above the previous week's levels.

Oil stored at Cushing, Oklahoma, the delivery point for WTI futures, fell 2.8 million bbl from the previous week to 27.7 million bbl.

U.S. crude oil production rose 100,000 bpd last week to 11.6 million bpd after declining for two consecutive weeks.

Gasoline stockpiles also unexpectedly fell by 1.6 million bbl to 248.4 million bbl compared with analyst expectations for inventories to have increased by 1.4 million bbl. Demand for motor gasoline shot up 900,000 bpd to 9.126 million bbl despite last week's winter storms that laid siege across southern states to states in the northeast. Distillate stocks fell by 930,000 bbl to 121.8 million bbl, and remain about 19% below the five-year average, the EIA said. Analysts estimated distillates inventories would fall by 2.1 million bbl from the previous week. Demand for distillates climbed 373,000 bpd from the previous week to 4.296 million bpd.

Total products supplied over the last four-week period averaged 21.9 million bpd, up 12.3% from the same period last year. Over the past four weeks, motor gasoline product supplied averaged 8.5 million bpd, up 7.9% from the same period last year. Distillate fuel product supplied averaged 4.6 million bpd over the past four weeks, up 9.9% from the same period last year. Jet fuel product supplied was up 30.4% compared with the same four-week period last year.

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