ANALYSIS: US product stocks continue to build as heavy draws in crude ends
Quantum Commodity Intelligence - US product stocks continued to rise last week, but the 2.3 million barrel gain was modest compared to the 10.3 million barrel build over the week to July 9, data from the Energy Information Administration showed Wednesday.
The increase occurred despite refinery utilization rates easing slightly again, down 0.4 percentage points for the second week running, and a jump in implied demand.
Total oil products supplied increased to 20.58 million bpd over the week to July 16, up 1.278 million bpd from the prior week.
Crude stocks built for the first time in two months to break a heavy sequence of draws, partly on higher imports and lower exports.
Including this week's 2.1 million-barrel gain, US commercial crude stocks have dropped 46.3 million barrels since May 14.
Strategic reserve crude stocks have also dropped 8.8 million barrels over the same period to make a combined crude draw of 55.1 million barrels.
But total US oil stocks, including crude and products, have only dropped 17.1 million barrels since May 14.
Oil product stocks have built 38 million barrels over the same period.
US gasoline stocks were flattish last week, dropping just 100,000 barrels to 236.4 million, which left them 2.2 million barrels higher than May 14.
Implied demand for gasoline, finished sales, was also flattish week-to-week.
Distillate stocks drew 1.3 million barrels over the week to July 16 but they were still 8.9 million barrels higher than May 14.
The big riser this week was propane, where stocks gained 3.1 million barrels to 62.7 million, allaying some fears over whether the market will build to 95 to 100 million barrels by October.
Overall, the world's largest oil consumer built total crude and product stocks by 4.4 million barrels last week.
OPEC+ will be adding more supplies in August, and there is talk of China releasing up to 29 million barrels of sour crude from its strategic reserves.
Bulls may have to wait until the fourth quarter for $80/b Brent, Goldman Sachs noted this week, after revising down its third-quarter forecasts for Brent this week to $75/b.
