DTN Oil

WASHINGTON (DTN) -- New York Mercantile Exchange oil futures moved mixed post-inventory trade Wednesday, with nearby-month RBOB and ULSD contracts softening in reaction to the U.S. Energy Information Administration showing commercial crude and gasoline inventories increased more than expected last week while demand for middle distillates fell back below 4 million barrels per day (bpd).

U.S. commercial crude oil inventories increased by 532,000 barrels (bbl) during the week ended Jan. 20 compared with expectations for stocks to have gained 100,000 bbl. At 448.5 million bbl, nationwide crude oil stockpiles now stand 3% above the five-year average. Oil stored at Cushing, Oklahoma, hub, the delivery point for West Texas Intermediate, jumped by 4.3 bbl from the previous week to 35.7 million bbl.

U.S. refiners again increased run rates by a smaller-than-expected 0.8% last week to 86.1% of capacity after utilization fell to the lowest weekly level since Winter Storm Uri in February 2021 shuttered much of the refining capacity in Texas and Louisiana. Analysts mostly expected run rates to recover by 1.2% from the previous week.

For the week, refiners processed 128,000 bpd more crude at an average of 14.981 million bpd, which is still near the lowest processing rate since late March 2021. Slow recovery in refinery runs follows a smattering of disruptions while also indicating some refiners are moving units into seasonal maintenance, which is heaviest in February.

Domestic oil production, meanwhile, remained unchanged at 12.2 million bpd.

In the gasoline complex, commercial stockpiles gained 1.8 million bbl in the reviewed week to 232 million bbl compared with expectations for a 1 million bbl increase. Demand for motor fuel edged up 88,000 bpd to 8.142 million bpd.

Distillate demand, however, decreased by 146,000 bpd to 3.878 million bpd after consumption fell the lowest level since April 2020 when the coronavirus pandemic shuttered large chunks of the economy. Domestic distillate stocks declined by 507,000 bbl to 115.3 million bbl.

Total products supplied to the U.S. market over the last four-week period averaged 18.9 million bpd, down 10.9% from the same period last year. Over the past four weeks, gasoline supplied to the domestic market averaged 7.8 million bpd, down 4.7% from the same year-ago period. Distillate fuel supplied averaged 3.6 million bpd over the past four weeks, down 13.6% from the comparable year-ago period.

Near 11 a.m. EST, NYMEX WTI for February delivery advanced to $80.58 per bbl, up $0.45, RBOB February contract declined $0.0279 to $2.6208 per gallon, and front-month ULSD futures dropped $0.0671 to $3.3577 per gallon.

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