ANALYSIS: Crude stocks build on lower exports, net product exports spike

Quantum Commodity Intelligence - US crude stocks posted a big build in the week ending 6 May, according to US government data released Wednesday, as an increase in net imports offset stagnant production and a rise in crude throughput at refiners as operators cashed in on higher international prices for diesel and gasoline.

Commercial crude stocks rose 8.5 million barrels to 424 million barrels, the EIA data showed, leaving stocks at the highest since June last year, although that is not particularly bearish as they remain down 13% on the five-year average.

And nearly all of the build in commercial stocks was offset by a record 7-million barrel drop in strategic reserves to just below 543 million barrels as the US government continued to try to contain prices by selling off reserves.

The weekly rise of both commercial and strategic stocks of 1.5 million bpd came despite a rise in crude throughput to a one-month high of 15.7 million bpd, up 230,000 bpd, as refineries operated at 90% of their operable capacity, marginally higher on the week.

The rise instead was down to net imports, as a fall in exports fell to a one-month low of 2.9 million bpd was matched by stable imports of 6.1 million bpd, leaving net imports at 3.4 million bpd – up 630,000 bpd and the highest level since early April.

Products

While crude stocks rose, gasoline stocks fell, as exports of mogas spiked and domestic consumption fell 154,000 bpd (2%) on the week to 8.7 million bpd – a one-month low and below the five-year average as record pump prices took their toll on demand.

US gasoline exports rose to 942,000 bpd, up compared to the four-week average of 914,000 bpd and up 31% on the five-year average.

That left gasoline stocks at 225 million barrels, down 3.6 million on the week and unwinding last week's build to leave them at the lowest in a month.

The dynamic was replicated in distillate fuel, where stocks of distillates fell nearly 1 million barrels to 104 million barrels – a 17-year low – as US refiners ramped up exports 13% on the week amid a fall in domestic consumption of 180,000 bpd to 3.8 million bpd.

The four-week average of exports of 1.3 million bpd is up 30% on the year as traders sent cargoes east and south.

At the refinery, operators continued to favour diesel and jet at the expense of gasoline, with distillate at a one-month high of 4.9 million bpd, up 163,000 bpd on the week and jet fuel rising to 1.7 million bpd, an increase of 144,000 bpd and its level since January 2020, before the pandemic began.

Gasoline production fell marginally to 9.8 million bpd, down 22,000 bpd week-on-week.

Week ending 06 May 2022

Key stock figures (million barrels)

Commercial crude and product stocks: 1699 m barrels, +2.9 m barrels on week.

Commercial crude stocks: 424 m barrels, +8.5 m barrels on week.

Strategic crude stocks: 543 m barrels, -7.0 m barrels on week.

Gasoline stocks: 225 m barrels, -3.6 m barrels on week.

Middle distillate stocks: 104 m barrels, -0.9 m barrels on week.

Jet stocks: 38 m barrels, +2.1 m barrels on week.

Diesel stocks: 95 m barrels, -0.1 m barrels on week.

Residual fuel stocks: 28 m barrels, 0.0 m barrels on week.

Propane/propylene stocks: 44 m barrels, +3.4 m barrels on week.

Ethanol stocks: 24 m barrels, +0.3 m barrels on week.

Key demand figures (million barrels per day)

Total oil products: 19.2 million bpd, -0.24 million bpd on week.

Gasoline: 8.7 million bpd, -0.15 million bpd on week.

Jet: 1.4 million bpd, 0.0 million bpd on week.

Middle distillates: 3.8 million bpd, -0.18 million bpd on week.

Residual fuels: 0.3 million bpd, -0.02 million bpd on week.

Propane/propylene: 0.8 million bpd, -0.2 million bpd on week.

Key production and trade figures (million barrels per day)

Crude production: 11.8 million bpd, -0.1 million bpd on week.

Crude imports: 6.3 million bpd, -0.06 million bpd on week.

Crude exports: 2.9 million bpd, -0.7 million bpd on week.

Product imports: 1.8 million bpd, -0.47 million bpd on week.

Product exports: 5.9 million bpd, +0.02 million bpd on week.

Key refining figures (million barrels per day)

Net crude input into refineries: 15.7 million bpd, +0.23 million bpd on week.

Utilisation: 90.0%, +1.6% point on week.

Finished gasoline output: 9.8 million bpd, -0.02 million bpd on week.

Jet output: 1.7 million bpd, +0.14 million bpd on week.

Middle distillates output: 4.9 million bpd, +0.16 million bpd on week.

Diesel output: 4.7 million bpd, +0.13 million bpd on week.

Fuel oil output: 0.3 million bpd, +0.02 million bpd on week.