U.S. crude stocks fell last week as imports plummeted, dropping after nine consecutive increases, while gasoline and distillate inventories declined more than expected, the Energy Information Administration (EIA) said March 15.
The stockpiles have been closely watched by oil traders eager to determine whether a November agreement to cut output by OPEC is reducing a global supply glut.
Crude inventories fell by 237,000 barrels (bbl) in the last week, compared with analysts' expectations for an increase of 3.7 MMbbl. Crude stocks at the Cushing, Okla., delivery hub rose by 2.13 MMbbl, EIA said.
U.S. crude oil imports fell by 565,000 bbl/d to 6.69 MMbbl/d last week, the lowest level in a month, mostly due to large declines from OPEC member countries. That includes a drop of 426,000 bbl/d to 1.08 MMbbl/d from Saudi Arabia, the largest weekly drop since September.
Crude imports from Iraq fell by 527,000 bbl/d to 403,000 bbl/d, the largest weekly drop since August. Meanwhile, declines were also seen from Kuwait and Nigeria.
Brent futures rose 83 cents to $51.75/bbl by 10:16 a.m. CT (15:16 GMT). Prices had hit a more than three-month low of $50.25 during the previous day's trading.
U.S. West Texas Intermediate crude was up 82 cents, or 1.72%, at $48.54. On March 14, the price fell to $47.09, the lowest since late November.
"It was a supportive report, due to the large drawdown in refined product inventories," said John Kilduff, partner at Again Capital in New York. "The crude drawdown was small, and was impacted by a drop in imports. The import levels continue to fluctuate in a wide-range week-to-week."
Overall inventory levels remain quite high relative to the seasonal average, which remains a significant headwind for the market, he said.
Sharp drawdowns in gasoline and distillate were also supportive, as they may set up a potential for greater crude stockpile declines in April as refineries return from maintenance, said Abhishek Kumar, senior energy analyst at Interfax Energy's Global Gas Analytics in London.
Gasoline stocks fell by 3.1 MMbbl, compared with analysts' expectations in a Reuters poll for a 2 MMbbl drop.
Distillate stockpiles, which include diesel and heating oil, fell by 4.2 MMbbl, vs. expectations for a 1.7 MMbbl drop, the EIA data showed.
Refinery crude runs fell by 20,000 bbl/d, EIA data showed. Refinery utilization rates fell by 0.8 percentage points.
"An unexpected drawdown in the U.S. crude oil stock was a result of reduced imports from Canada despite marginal increase in domestic production," Kumar said. "However, this unseasonal draw is not a trend and oil stock builds are expected to make a comeback."
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