U.S. crude stocks rose last week even though refineries hiked output, which also boosted gasoline and distillate inventories, the Energy Information Administration (EIA) said Feb. 7.
Refinery crude runs rose by 784,000 barrels per day (bbl/d), EIA data showed. Refinery utilization rates rose by 4.4 percentage points.
That boosted inventories of gasoline and diesel fuel heading into the less busy season, feeding concerns about supply. Oil production appeared to reach a new U.S. record, pending confirmation by monthly figures due in several weeks.
U.S. West Texas Intermediate crude oil futures were down $1.35/bbl, or 2.1%, as of 10:05 a.m. CST (16:05 GMT) to $61.96/bbl. Global benchmark Brent crude fell 84 cents to $66.03/bbl.
Domestic crude production hit 10.25 million bbl for the most recent week, which would exceed the all-time U.S. monthly record of 10.044 million bbl/d, set in 1970.
"The new world order of U.S. production over 10 million bbl/d is officially here," said John Kilduff, partner at energy hedge fund Again Capital in New York.
The EIA said November U.S. production rose to 10.038 million bbl/d, even though less-reliable weekly figures released at the time were far short of that number.
Crude stocks at the Cushing, Okla., delivery hub fell by 711,000 bbl, EIA said.
Gasoline stocks rose by 3.4 million bbl, compared with analysts' expectations in a Reuters poll for a 459,000-bbl gain.
"The strong increases in product stocks and the build in crude stocks despite much higher processing are also bearish," said Carsten Fritsch, oil analyst at Commerzbank AG in Frankfurt, Germany.
Distillate stockpiles, which include diesel and heating oil, rose by 3.9 million bbl, vs. expectations for a 1.4 million-bbl drop, the EIA data showed.
Net U.S. crude imports fell last week by 60,000 bbl/d.