U.S. crude oil stockpiles slumped while gasoline inventories jumped last week after winter weather hit crude production and imports, refining, and demand for fuel, the Energy Information Administration said on Wednesday.
Crude inventories fell by 9.2 million barrels to 420.7 million barrels in the week ending Jan. 19, the EIA said, compared with analysts’ expectations in a Reuters poll for a 2.1 million-barrel draw.
The draw was driven by a stark drop in U.S. crude imports of 1.2 million barrels per day (bpd) as the weather shut in refineries and kept motorists off the road.
The winter storms also caused 1 million-bpd drop in crude production to 12.3 million bpd, the biggest drop since September 2021, the EIA estimated. January production data will be reported in the its monthly report at the end of March.
Crude output in North Dakota, the third largest oil producing state, was halved last week, falling by as much as 700,000 bpd, due to extreme cold weather and operational challenges, according to the state’s pipeline authority.
As frigid weather caused power outages and plant malfunctions, refinery crude runs fell by 1.4 million bpd to 15.3 million bpd and utilization rates slumped by 7.1 percentage points to 85.5 per cent of total capacity, their biggest declines since December 2022 during Winter Storm Elliot.
“It’s a winter weather report all around … nobody was driving,” said Bob Yawger, director of energy futures at Mizuho in New York.
Gasoline stocks rose by 4.9 million barrels to 253 million barrels, their highest since February 2021, the EIA said, compared with forecasts of a 2.3 million-barrel build. Gasoline product supplied, a proxy for demand, fell last week by 390,000 bpd to 7.9 million bpd, its lowest in a year.
Distillate stockpiles, which include diesel and heating oil, fell by 1.4 million barrels in the week to 133.3 million barrels, versus expectations for a 300,000-barrel rise, the EIA data showed.
Crude stocks at the Cushing, Oklahoma, delivery hub for U.S crude futures fell by 2 million barrels in the week, the EIA said.
The data lifted U.S. crude futures $1.40, or 1.9 per cent, to $75.77 a barrel by 11:59 a.m. ET (1659 GMT).
“Recovery is likely to be slow, with distortions also expected to influence the data next week,” said UBS analyst Giovanni Staunovo.
North Dakota regulators last week warned that it could take a month for production there to recover from output cuts from the winter storms.