Analysis of U.S. EIA data: Crude imports fall to a 15-month low on weak demand
New York - December 16, 2009
U.S. crude imports dropped 365,000 barrels per day (b/d) to 7.772 million b/d last week, a 15-month low, oil data released Wednesday by the U.S. Energy Information Administration (EIA) showed.
The drop in imports contributed to a 3.689-million-barrel decline in U.S. crude stocks, an analysis of the EIA report showed, larger than the 2-million-barrel draw estimated by analysts.
Gulf Coast crude imports declined 79,000 b/d to 4.081 million b/d, the lowest since the week ending September 30, 2005 when Hurricane Rita kept tankers from offloading in the Houston Ship Channel and the Louisiana Offshore Oil Port.
Low demand and weak margins have curtailed refiners' appetites for crude barrels. Crude imports were down in every region except the Atlantic Coast, where imports rose 96,000 b/d to 1.296 million b/d.
And low imports more than offset a 117,000-b/d drop in refinery inputs to 13.804 million b/d.
The draw in U.S. crude stocks left inventories 19.243 million barrels above the five-year average and 11.098 million barrels above year-ago levels.
While U.S. crude stocks have declined just 5.039 million barrels during the fourth quarter, the surplus against the averages has eroded substantially. The surplus against the five-year average has decreased 10.6 million barrels and has fallen 23.741 million barrels from year-ago levels.
The crude stock decline occurred primarily on the Gulf and West coasts.
Gulf Coast crude inventories decreased 5.081 million barrels to 159.709 million barrels, a 15-month low.
Crude inventories at the critical pricing and delivery point in Cushing, Oklahoma increased 782,000 barrels to 34.135 million barrels, with the rate of stock-building slowing from previous weeks. Crude stocks at Cushing, however, are just 781,000 barrels below the all-time high posted in February 2009.
With crude runs declining yet again, refiner output of nearly every refined product with the exception of jet fuel was down. Most notably, production of middle distillates fell 268,000 b/d to 3.726 million b/d, 891,000 b/d below the same week one year ago.
Falling production of middle distillates just as demand showed a strong uptick resulted in a larger-than-expected 2.954 million barrel decline in stocks. Analysts projected a decline of 750,000 barrels.
At 164.363 million barrels, stocks of middle distillates were still 35.765 million barrels above the five-year average and 30.84 million barrels above year-ago levels. While the bulk of the draw in middle distillates was concentrated in heating oil, down 2.3 million barrels to 48.327 million barrels, ultra-low sulfur diesel and diesel stocks declined a combined 800,000 barrels.
Implied demand* for middle distillates soared 472,000 b/d to 3.792 million b/d as colder temperatures moved in along the Atlantic Coast.
While demand for distillates was making a seasonal swing to the upside, gasoline demand edged down 49,000 b/d to 8.963 million b/d just as imports rebounded 217,000 b/d to 967,000 b/d. Stocks climbed 879,000 barrels, less than the 1.5 million barrels expected.
The build in gasoline inventories was tempered by a decline in output of 66,000 b/d to 9.097 million b/d. At 217.213 million barrels, gasoline stocks were 12.094 million barrels above the five-year average and 13.254 million barrels above year-ago levels.
Total U.S. oil demand bounced 1.224 million b/d to 19.572 million b/d week-over-week with gains occurring in every product except gasoline and residual fuel oil. Still, U.S. oil demand on a four-week moving average at 18.766 million b/d was down 1.7% year-over-year, or 318,000 b/d than the previous year.
*Implied demand is the amount of product that moves through the U.S. distribution system, not actual end consumption.
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