EIA US Stocks Preview: Another Crude Draw Expected

EIA Oil Inventory Preview: The EIA weekly petroleum status report will be released at 11:00 ET (16:00 BST) today.

• Crude inventories are expected to draw by -2.16mbbls for the week ending 30 June according to a Bloomberg survey. Crude stocks showed a big draw last week driven by an increase in exports back above 5mbpd for the first time since March, offsetting higher imports and a drop in refinery utilisation while production remained unchanged. Refinery utilisation is expected to tick back up by +0.22% to 92.4% this week. The WTI-Brent spread has been easing lower over the last month to around -4.8$/bbl this week to help support exports amid weak US demand concerns and high Cushing stocks. Cushing stocks are expected to fall back from the highest since Jun 2021 with AlphaBBL expecting a draw of -0.615mbbls this week. US SPR reserves fell 1.4mbbls on the week to 347.2mbbls as the DOE nears the end of the deliveries planned for April to June.
• Product stocks are expected to show small draws of -0.28mbbls for gasoline and -0.20mbbls for distillates according to a Bloomberg survey. US imports of European gasoline have slipped to a 5-week low after the surge in April/May ahead of the summer driving season according to Bloomberg. East Coast stocks have fallen recently to 14.5% below normal against higher domestic demand from the driving season while a pick-up in European gasoline has weakened shipments from the key supplier. Weekly US gasoline demand rose 4.3% from last week and 4.5% above the four-week average, driven by increased travel for July 4 holiday according to GasBuddy data.
• Diesel cracks are balancing weak demand concerns and returning global supplies against low global inventories. Russian diesel exports were at a three-month high in June while Chinese refiners are expected to increase throughput in July as maintenance in both countries eases. Fresh refinery disruption in Europe this week could aid flows to Europe although will not be reflected in the data released today. Four-week implied distillates demand fell last week to the lowest since January and a seasonal five year low (excluding 2020). Implied gasoline demand has seen steady gains throughout most of the year so far and in line with the seasonal trend at the start of the summer driving season.
• The API data released last night showed a crude stock draw of -4.4mbbls with build of +0.3mbbls at Cushing. Gasoline inventories showed a build of 1.6mbbls and distillates a build of +0.6mbbls.