The US Energy Information Administration (EIA) in its latest Petroleum Supply Monthly, said that US commercial crude oil stocks increased by 46.7 million barrels (10%) in April during the height of the coronavirus-related lockdown. EIA noted that the build in April was the sharpest monthly rise in its record dated back to 1920.
At the same time, US refiners operated their facilities at 70% of their capacity, the weakest utilisation rate in EIA’s data going back to 1985. The high level of crude stocks and low refinery utilisation rates were a result of weak demand for finished petroleum products which dropped to 11.7 million bpd. According to EIA, the demand in April was the lowest since at least 1981.
EIA’s data showed the US pumped 12.1 million bpd of crude in April, 669,000 bpd (5%) lower than March’s output. EIA said that the production decline in April represented the steepest monthly output drop since Hurricanes Ike and Gustav hit the US Gulf Coast in September 2008. At the same time, crude imports declined 776,000 b/d (12%) from March to April. Lower domestic output and imports, however, could not offset the decrease in gross inputs to refineries, resulting in record build in US crude stocks.
The stay-at-home orders put heavy pressure on US fuel demand. Product supplied of finished motor gasoline, a proxy for demand, decreased a record 1.9 million bd (25%) from March to the lowest since the mid-1970s at 5.9 million bpd in April. From February to April, demand for jet fuel plunged by more than 50%, from 1.6 million bpd to 691,000 bpd, dipping to below 700,000 bpd for the first time since the mid-1970s. Meanwhile, distillate demand fell by 408,000 bpd (10%) from March to more than a decade low in April.
