EIA US Oil Stocks Preview: Refinery Runs to Continue Recovery

EIA Oil Inventory Preview: The EIA weekly petroleum status report will be released at 10:30 ET (14:30 GMT) today.

• Crude inventories are expected to show a build of +0.31mbbl for the week ending Mar. 8, according to a Bloomberg survey. US crude inventories last week built for a sixth week with an increase in refinery run rates and drop in production offset by a rise in imports above the previous five year range. The US seaborne crude oil exports are expected to remain strong in March despite fog disruptions and imports are also expected to rebound according to Kpler. Production last week fell back from record high levels to 13.2mb/d. US SPR stocks continue the slow recovery up by 0.6mbbl this week according to preliminary data.
• US refinery utilisation is recovering from the heavy outages seen in Feb with more facilities likely back online in the coming weeks. Utilisation increased more than expected last week to the highest since mid January at 84.9%. US refinery intake declined by 1mb/d on the month to 14.91mb/d in February according to the OPEC MOMR. Refinery utilisation is expected to increase 0.85% w/w according to a Bloomberg survey.
• Total US gasoline stocks are expected to draw by 1.62mbbl and distillates to draw by 0.70mbbl, according to a Bloomberg survey. Distillates stocks fell last week to 10.0% below normal with an increase in exports adding to a rise in implied demand on the week. The large weekly increase in demand helped take the four week average demand back within the previous five year range but remains below normal.
• Gasoline implied demand also rose on the week as stocks fell more than expected despite the rise in production and higher imports. Four week implied demand rose in line with the seasonal norm but remains below normal. US retail gasoline demand saw a decrease of 2.4% to 8.361mbpd for the week ending March 10 according to GasBuddy. All three US Gulf Coast gasoline grades pushed to nearly six-month highs March 11 as they shifted to summer specifications according to Platts. Refining margins above seasonal norms are a sign of tightness as the US summer driving season approaches with the US 321 crack spread trading near the highest since September at around $32.4/bbl.
• The API data released last night showed a crude draw of 5.5mbbl, with a draw of 0.998mbbl at Cushing. Gasoline inventories showed a draw of 3.8mbbl while distillates stocks fell by 1.2mbbl.