New York — The crude complex settled higher Wednesday after US government data showed a 2.57 million-barrel decline in the nation's crude stocks despite lower demand from domestic refineries.
ICE October Brent crude futures settled up $1.19/b at $77.14/b, while the NYMEX October light sweet crude contract settled 98 cents/b higher at $69.26/b.
Crude inventories along the US Atlantic and US West Coast bore the brunt of the US crude stock decline, shedding 2.9 million barrels and 1 million barrels to 11.6 million barrels and 49 million barrels, respectively, for the week ended August 24, Energy Information Administration data showed.
USAC crude stocks fell on a decline in imports to 340,000 b/d from the 668,000 b/d in the week earlier, in preparation for planned work at area refineries.
This includes planned work at Monroe Energy's 190,000 b/d Trainer, Pennsylvania, refinery scheduled for after the Labor Day weekend holiday.
USAC refiners were operating at 88.2% of capacity last week, down from 88.6% the prior week, the EIA data showed.
Lower USAC rates were partly due to Phillips 66's 238,000 b/d Bayway, New Jersey, plant operating at reduced rates since August 10 because of a problem with its 145,000 b/d FCCU.
USWC refinery operations experienced some slight disruption last week from Hurricane Lane, which travelled the eastern Pacific, slowing crude imports by 280,000 b/d to 1.081 million barrels. Par Petroleum, dependent on imports for 100% of its crude supply, shut its 93,500 b/d Hawaii refinery Wednesday ahead of the storm, restarting it this weekend.
Overall, USWC plants were operating at 98.4% of capacity, up from the 97.9% the week earlier as California refineries pulled on indigenous crudes to run their plants. Washington refineries raised rates of Alaska North Slope crude as the end of field maintenance pushed Alaskan production 33,000 b/d higher on the week to 462,000 b/d.
USGC, MIDWEST CRUDE IMPORTS INCREASE
USGC crude stocks stayed flat at 212.8 million barrels as an increase in imports mitigated an increase in crude exports. That left USGC inventories at roughly 4.6% above the five-year average.
USGC crude imports jumped by 653,000 b/d to 2.914 million b/d while exported barrels gained 624,000 b/d to 1.779 million b/d.
The 100,000-barrel crude build at Cushing, Oklahoma, contributed to the Midwest's growth in inventories to 110.4 million barrels from the week earlier's 109.3 million barrels.
Midwest stocks are at a 7.7% deficit to the five-year average, although that is up from an 11% deficit the week ending August 3.
However, Midwestern crude exports ticked lower, to 2.825 million b/d from 2.896 million b/d, in anticipation of a heavy refinery maintenance season beginning with BP's Whiting, Indiana, refinery in September.
Midwest refiners were operating at 100% of capacity last week, while USGC refiners were operating at 95.8% of capacity, the EIA data showed.
Overall, US refinery utilization slowed 1.8 percentage points to 96.3%
ULSD, RBOB SETTLE HIGHER ON PRODUCT INVENTORY DROPS
September NYMEX RBOB settled up 3 cents/gal at $2.1060/gal while September NYMEX ULSD also gained 3 cents/gal on the day to settle at $2.2421/gal.
USAC distillate stocks fell 555,000 barrels to 41.65 million barrels last week, deemed supportive for the higher settle on the New York-delivered NYMEX ULSD contract.
Total US gasoline inventories fell 1.61 million barrels last week to 222.8 million barrels, while distillate stocks fell 837,000 barrels to 130 million barrels.
However, the bulk of the gasoline stock decline -- 1.17 million barrels -- was on the USWC. Stocks on the USAC climbed 837,000 barrels to 64.07 million barrels, courtesy of high refinery runs and a 96,000 b/d jump in gasoline imports to 844,000 b/d.
Stocks on the USAC are now roughly 5% above the five-year average, which could be bearish for the New York-delivered NYMEX RBOB contract.
However, inventories typically begin to draw this time of year as refiners shift their focus to diesel production.
