U.S. West Texas Intermediate and international-benchmark Brent crude oil futures are trading nearly flat today after finishing sharply higher the previous session on the back of a surprise drop in U.S. crude stockpiles.
Gains are being limited, however, on Thursday by the re-emergence of demand worries as crews return to U.S. Gulf rigs. U.S. crude oil stockpiles unexpectedly fell last week despite rising production, while distillate inventories were up once again, the U.S. Energy Information Administration said on Wednesday.
Crude inventories fell to their lowest since April at 496 million barrels in the week to September 11, sliding 4.4 million barrels, compared with analysts’ expectations in a Reuters poll for a 1.3 million-barrel rise. Production rose for a second consecutive week, jumping 900,000 barrels per day of crude last week, to 10.9 million bpd, the data showed.
Distillate stockpiles, which include diesel and heating oil, rose by 3.5 million barrels last week to 179.3 million barrels, versus expectations for a 600,000-barrel rise, the EIA data showed.
U.S. gasoline stocks fell 400,000 barrels to 231.5 million barrels, the EIA said, compared with analysts’ expectations for a 160,000-barrel drop. Crude oil stocks at the Cushing, Oklahoma, delivery hub for WTI fell by 74,000 barrels, the EIA said.
Refinery runs rose by 709,000 bpd in the last week, the EIA said. Refinery utilization rates rose by 4 percentage points, in the week. Net U.S. crude imports fell last week by 66,000 bpd, the EIA said.
WTI and Brent crude oil prices are being capped on Thursday as U.S. producers in the Gulf of Mexico prepared to resume output following Hurricane Sally, and on concerns that the coronavirus pandemic was showing few signs of slowing.