Oil Market Declines After EIA Product Build and Weak Demand

Crude and crack spreads all fell after a bigger than expected build in oil product stocks and a further weakening of the implied demand. EIA inventories showed a larger crude draw and bigger distillates and gasoline build than expected with the refinery utilisation once again rising quicker than forecast.

• US refinery utilisation has increased for six weeks and is now up to 95.5%, the highest since August 2019. Rates rose despite declines on the East Coast and Gulf Coast. Crude stocks built despite a small increase in US production.
• Crude exports dipped but remain above the five year average. Gasoline and distillate exports also fell slightly. Higher distillate imports helped the big stock build.
• Weak product demand continues with a further drop in both the gasoline and distillate four week product supplied data. Distillate demand has now fallen well below the five year average for the time of year.
  • Brent FEB 23 down -0.1% at 79.28$/bbl
  • WTI JAN 23 down -0.2% at 74.08$/bbl
  • WTI-Brent up 0.02$/bbl at -5$/bbl
  • WTI JAN 23-FEB 23 down -0.01$/bbl at -0.22$/bbl
  • WTI JUN 23-DEC 23 up 0.12$/bbl at 1.37$/bbl
  • US gasoline crack down -0.4$/bbl at 15.57$/bbl
  • US ULSD crack down -1.3$/bbl at 46.61$/bbl