EIA Oil Stocks Preview: Crude Draw and Product Build Expected

EIA Oil Inventory Preview: The EIA weekly petroleum status report will be released at 10:30 ET (15:30 GMT) today

• Crude inventories are expected to draw -2.91mbbls for the week ending 25th November according to a survey, following a draw of -3.7mbbls last week. An unexpected increase in crude imports last week was offset by ongoing strong exports. Exports are still supported by strong demand from Europe and as holders of US Gulf Coast stocks try to reduce inventories to avoid taxes that are typically collected on Dec 31. Gulf Coast loadings however saw some disruption in the week due to stormy conditions, while Gulf Coast pipeline issues and high freight rates could potentially have impacted exports. Data last week showed Cushing inventories below the five year range but the WTI-Brent spread remained around -7$/bbl in the week with ongoing US SPR releases.
• Refinery outages have continued to decline as seasonal maintenance draws to a close. The recovery in utilisation is expected to continue again this week with a survey suggesting refinery utilization will increase by 0.18% to 94.1%. Utilisation is at its highest since August with refiners cutting gasoline yields down to 56% last week compared to 61% the previous week.
• Gasoline and diesel stocks are expected to show builds this week with gasoline up +1.74mbbls and a distillate up +1.43mbbls. Total US distillate and gasoline stocks are still below their five-year averages with refiners slowly replenishing stocks. The build in distillate and gasoline stocks last week was assisted by a dip in exports and a small increase in imports. Despite the overall build in US stocks, the East Coast gasoline stocks fell to their lowest since 2012 due to a drop in imports from Europe.
• Recession fears and concerns over oil demand have been weighing on crude prices and limiting diesel and gasoline upside moves. The four-week gasoline supplied figure fell again last week to remain only just above 2020 levels while distillate supplied is holding near range lows.
• The API data released last night showed a draw in crude stocks of -7.85mbbls and a draw at Cushing of -0.15mbbls. Gasoline inventories showed a build of +2.85mbbls and distillate inventories reported a build of +4.01mbbls.