US crude stockpiles fall as refining runs hit 2020 high – EIA

Aug 23 (Reuters) – U.S. crude oil inventories fell last week as refinery processing surged and crude output reached their highest since the coronavirus pandemic decimated fuel consumption, Energy Information Administration data showed on Wednesday.

Crude inventories (USOILC=ECI) fell by 6.1 million barrels in the week to Aug. 18 to 433.5 million barrels, compared with analysts’ expectations in a Reuters poll for a 2.8 million-barrel drop.

Refinery crude runs (USOICR=ECI) rose 30,000 barrels per day (bpd) last week to 16.78 million barrels per day, their highest since January 2020, even as refinery utilization rates (USOIRU=ECI) ticked down 0.2 percentage point to 94.5% of total capacity.

Crude exports fell by 340,000 bpd last week but remained seasonally strong at 4.3 million bpd. Net U.S. crude imports (USOICI=ECI) edged up by 116,000 bpd, the EIA said.

“Ongoing strength in refining activity and crude exports have encouraged a solid draw to oil inventories, while peak summer refinery runs have resulted in builds for both gasoline and distillates,” said Math Smith, lead oil analyst for Americas at Kpler.

Crude stocks at the Cushing, Oklahoma, delivery hub fell by 3.1 million barrels last week – the biggest weekly draw since October 2021 – as barrels are pulled to the Gulf Coast to meet peak summer refining needs and export demand amid OPEC+ production cuts.

Inventories are falling despite an increase in crude production, which rose 100,000 bpd to 12.8 million bpd, its highest since March 2020, when restrictions around the coronavirus pandemic caused a drop-off in fuel demand.

“The incentive to drill is just off the charts at this point,” said John Kilduff, partner at Again Capital LLC in New York.

Gasoline stocks (USOILG=ECI) rose by 1.5 million barrels last week to 217.6 million barrels, the EIA said, compared with forecasts for a 900,000-barrel drop.​

Distillate stockpiles (USOILD=ECI), which include diesel and heating oil, rose by 900,000 barrels to 116.7 million barrels, versus expectations for a 200,000-barrel rise.

Crude prices rose on the data but remained in the negative. U.S. West Texas Intermediate crude futures fell 54 cents to $79.10 a barrel by 10:58 a.m. EDT (1458 GMT) after reaching a low of $77.63 earlier in the session. Brent fell 68 cents to $83.35 a barrel after reaching a session low of $81.94 before the data was released.

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