U.S. crude oil inventories fell for the seventh straight week as refiners processed a near record amount of crude last week, the Energy Information Administration (EIA) said May 24, even as gasoline and distillate stockpiles also dipped.
Crude inventories fell 4.4 million barrels (bbl) in the week ended May 19, more than analysts' forecasts of a 2.4 million bbl decline.
At 516.3 million bbl, U.S. crude inventories were the smallest since mid-February, a sign that OPEC's efforts to reduce world supply are starting to have an effect in the U.S., the world's largest oil consumer.
The data comes one day before OPEC, along with non-member nations, are scheduled to decide whether to extend its agreement to cut world supply, an effort that has only recently started to bear fruit in global inventory figures.
Refinery crude runs rose 159,000 bbl/d to 17.281 million bbl/d last week, the second highest volume of crude processed since the EIA began collecting the data in 1982. The record volume was 17.285 million bbl/d in late April.
Refinery utilization rates edged up 0.1 percentage points to 93.5% of nationwide capacity. Refiners have come back from spring turnarounds at full throttle with rates above 90% for eight straight weeks, including a record of 94.1% in late April.
“Gasoline demand is picking up in the U.S., which also resulted in larger-than-expected crude drawdown despite higher oil production and imports," said Abhishek Kumar, senior energy analyst at Interfax Energy's Global Gas Analytics in London.
Refiners have said product exports are supporting the high refining rates. Product exports have averaged 4.7 million bbl/d over the last four weeks, the EIA data showed, up more than 30% than this time a year ago.
U.S. crude production rose to 9.32 million bbl/d from 9.301 million bbl/d and crude imports rose slightly by 165,000 bbl/d.
Crude stocks at the Cushing, Okla., delivery hub for crude futures fell by 741,000 bbl, EIA said.
Crude futures rose briefly on the data. But an hour later, by 10:30 a.m. CT (15:30 GMT) West Texas Intermediate crude was down 8 cents at $51.39/bbl after touching $51.88/bbl, highest since April 19.
Gasoline stocks fell 787,000 bbl, compared with expectations in a Reuters poll for a 1.2 million bbl drop.
Distillate stockpiles, which include diesel and heating oil, fell by 485,000 bbl, vs. expectations for a 743,000 bbl drop, the EIA data showed.
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