On Wednesday, the US Energy Information Administration (EIA) showed that the inventories of crude oil and distillate unexpectedly rose last week due to the sharp outbreak in the country’s coronavirus cases hit consumption.
In the week to July 17, crude oil stockpiles surged by 4.9 million barrels to 536.6 million barrels. Analysts from a Reuters’ poll only predicted a 2.1 million barrel fall. Output jumped by 100,000 bpd to 11.1 million bpd in the period.
Distillate inventories climbed by 1.1 million barrels, to 177.9 million barrels. The reading was the highest since December 1982 while analysts only foresaw a 618,000 barrel drop.
Gasoline stocks, however, exceeded expectations with the fall of 1.8 million barrels last week as the forecasts were only at 1.4 million barrel slump. The fall was attributed to the drop in refinery utilization rates by 0.6% to 77.9% of capacity.
US East Coast refinery rates slumped to the lowest on record since 2010, at 36.6%.
The overall product supplied was down by 4% to 17.7 million bpd. The four-week average was still close to 15% lower than the same period a year ago at 17.9 million bpd.
Analyst Phil Flynn of Price Futures Group commented that the stalled demand recovery from the bottom dragged the market down.
The EIA data was in line with the report from the American Petroleum Institute on Tuesday, which showed a drawdown of 7.5 million barrels of crude.
Reacting to the data, oil prices trimmed losses as at 14.43 GMT, the US WTI crude futures edged down by 45 cents to USD41.47/barrel, and Brent crude futures lost 43 cents to USD43.89/barrel.
