EIA Oil Stocks Preview: Small Draws Expected

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

• Crude inventories are expected to have a small draw of -0.11mbbls for the week ending 7 July according to a Bloomberg survey. A fall in crude stocks in recent weeks has been supportive of oil markets with lower inventories last week despite higher production and a pullback in crude exports from over 5mbpd the previous week. Refinery utilisation is expected to tick back up by +0.23% to 91.3% after the decline in data last week. Crude exports remain high with the WTI-Brent spread still holding relatively unchanged this month at around -4.7$/bbl.
• Cushing stocks are expected to ease lower again this week from the peak seen a couple of weeks ago with AlphaBBL expecting a draw of -1.85mbbls this week. US SPR reserves fell 0.4mbbls on the week as the DOE completes the withdrawals ahead of the 12mbbl injections planned for later this year.
• Product stocks are expected to show draws of -1.37mbbls for gasoline and -0.62mbbls for distillates according to a Bloomberg survey. US imports of European gasoline edged higher last week after dropping following a surge in April/May ahead of the summer driving season according to Bloomberg. Low US gasoline stocks are still supportive of crack spreads although uncertainty remains over the strength of demand from the US driving season. OPIS and GasBuddy data suggest the brisk gasoline demand number for the week leading up to the holiday week was followed by sharply lower demand.
• Diesel cracks continue to balance weak demand concerns and returning global supplies against low inventories sensitive to supply disruptions. US Gulf Coast diesel exports to Europe so far this month are on track to hit the highest monthly rate since at least 2017 amid soft domestic consumption. EIA implied demand data last week showed the four-week average gasoline demand at the highest since November 2021 but distillates demand remains near the lower end of the five-year seasonal range.
• The API data released last night showed a crude stock build of +3.0mbbls with a draw of -2.2mbbls at Cushing. Gasoline inventories showed a build of +1.0mbbls and distillates a build of +2.9mbbls.