EIA Oil Stocks Preview: Refinery Recovery and Crude Draw 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 -2.49mbbls for the week ending 18th November according to a survey, following a draw of -5.4mbbls last week. The expectation is for exports to remain high and an increase in refinery utilisation which are feeding the forecast of another crude stock draw this week. The lowest crude imports since May 2021 added to the draw last week. The WTI-Brent spread traded as wide as -8.5$/bbl last week due to US SPR releases and strong European demand as they withdraw from Russian crude supplies. Inventories at Cushing were last week reported at the bottom of the five-year range for this time of year.
• Last week saw larger than expected refinery utilisation as facilities continue to return from maintenance to reach the highest seasonal level since 2004 at 92.9%. The recovery is expected to continue this week with a survey suggesting refinery utilization is up by 1.12% to 94%.
• Total US distillate and gasoline stocks remain below their five-year averages with refiners struggling to replenish stocks despite the recovery of run rates. Higher expected utilisation this week should assist towards stocks builds but is not expected to be enough to take the pressure off refined product crack spreads. The expectation is for gasoline and diesel stocks to show small builds with a gasoline build of 0.965mbbls and a distillate build of 0.16mbbls.
• The volatile product supplied data was showing weak distillate and gasoline implied demand last week. Concern for economic slowdown and high pump prices is weighing on crude prices and limiting diesel and gasoline upside moves.
• The API data released last night showed a draw in crude stocks of -4.8mbbls and a draw at Cushing of -1.4mbbls. Gasoline inventories showed a draw of -0.4mbbls and distillate inventories reported a build of +1.1mbbls.