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POST DOE WRAP: Crude oil rises even as inventories climb

HOUSTON, MAY 18, 2016 (PCW) -- NYMEX crude and products futures prices were higher early Wednesday after government figures showed an increase in crude stocks but a draw in products.

The US remains very long in crude, gasoline, and diesel. Refinery crude input volumes increased nationwide. Gasoline and diesel demand is good, but net exports were down.

As of 9:48 am CST, June NYMEX WTI was up $0.05/bbl to $48.36/bbl, June gasoline rose 11.14 cpg to 164.55 cpg, and June diesel was up 1.79 cpg to 148.53 cpg.

Crude inventories rise

The US Energy Information Administration statistics for the week ending May 13 showed a 1.3 million barrel increase in crude inventories to 541.3 million barrels. Domestic crude oil production was put at 8.791 million b/d, down 11,000 b/d for the week and 471,000 b/d lower versus the same period last year.

This is the 13th week in the past 14 that crude production has fallen. Still, those inventories are “historically high” for this time of year, per the EIA.

Imports of crude were up 22,000 b/d to 7.7 million b/d on the week. Over the past four weeks, crude imports averaged 7.6 million b/d, an increase of 8.8% compared to last year at this time.

Total product demand over the past four weeks was put at 20.2 million b/d, up 2.7% versus the same period last year.

Gasoline inventories fall

Total gasoline inventories were down 2.5 million barrels to 238.1 million (still “well above the upper limit of the average range,” per the EIA). Demand was 9.6 million b/d over the past four weeks, up 5.7% from the same period last year.

Distillate stocks fell 3.2 million barrels to 152.2 million (“well above the upper limit of the average range,” per the EIA). Distillate demand over the past four weeks was down 0.9% to 4.1 million b/d compared to the same period last year.

Propane/propylene inventories on the week were up 1 million barrels to 74.2 million barrels, 4.7 million barrels over last year.

Refinery runs are up

Total US refinery inputs were 16.4 million b/d, up 192,000 b/d compared to the previous week. Inputs of crude oil nationwide to refineries on a percentage basis were up 1.4% on the week, put at 90.5% of capacity. In the Gulf Coast (PADD III), inputs rose 4% to 93.3%.

Also, net exports of all products were put at 1.498 million b/d, down 68,000 b/d for the week, a moderately bearish number. The US needs to export products to keep inventories manageable.

While gasoline demand was put at 9.6 million b/d, gasoline production came in at 10 million b/d. Distillate demand is 4.1 million b/d, but production was 4.8 million b/d. -- Robert Sharp

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