U.S. crude oil stocks fell for the fourth straight week as imports dropped, while gasoline stocks increased and distillate inventories fell, the U.S. Energy Information Administration (EIA) said on Sept. 28.
Crude inventories fell 1.9 million barrels (MMbbl) in the week to Sept. 23, compared with analysts' expectations for an increase of 3 MMbbl. A large drop in stocks on the East Coast was primarily responsible for the nationwide drawdown in stocks.
The month-long drawdown in crude stocks has surprised some analysts after a massive 14 MMbbl storm-related drop in inventories at the beginning of September.
Inventories were expected to rebound after the big drop a few weeks ago, but instead stocks have continued to decline with imports. U.S. crude imports fell last week by 393,000 bbl/d.
"The report is bullish given the crude oil and distillate category inventory declines. The low imports continue to drag down overall crude inventories, defying expectations of a strong rebound," said John Kilduff, partner at New York energy hedge fund Again Capital.
The crude drawdown was entirely attributable to a sharp drop in inventories on the U.S. East Coast, where stocks plummeted 3.3 MMbbl, also its biggest weekly crude draw since May 2004, the data showed.
Inventories, however, rose sharply by 2.5 MMbbl on the U.S. West Coast, even as imports were down in that part of the country.
"In sum, the crude numbers for the East and West Coasts are somewhat puzzling," said Tony Starkey, manager of energy analysis at Platts Analytics.
Stocks at the Cushing, Okla., delivery hub for U.S. crude futures fell 631,000 bbl, EIA said.
West Texas Intermediate initially rallied on the news, but then fell back. U.S. crude was last down 0.1% at $44.63/bbl after briefly touching $45.79/bbl. Brent crude was up 0.1% to $46.03/bbl.
Refinery crude runs fell 253,000 bbl/d and utilization rates dropped 1.9 percentage points to 90.1% of total capacity, EIA data showed.
Distillate stockpiles, which include diesel and heating oil, fell 1.9 MMbbl, vs. expectations for a 14,000 bbl decline.
Gasoline stocks rose 2 MMbbl, compared with expectations for a gain of 178,000 bbl, the EIA data showed.