U.S. gasoline inventories saw an unexpected increase last week before the Thanksgiving holiday, while crude oil stockpiles decreased more than analysts anticipated, according to the Energy Information Administration (EIA).
Key Highlights:
Gasoline Inventory Build:
Gasoline stocks rose by 3.3 million barrels to 212.2 million barrels for the week ending November 22, contrary to analysts’ expectations of a 46,000-barrel draw.
This surprising build occurred despite forecasts of record travel for the Thanksgiving holiday.
Market Reaction:
Following the EIA report, Brent crude, U.S. crude futures, and U.S. gasoline futures all experienced slight declines.
Matt Smith, an analyst at Kpler, noted the unexpected nature of the gasoline inventory increase given the anticipated surge in travel.
Demand Insights:
Gasoline supplied, a proxy for demand, increased marginally to 8.51 million barrels per day (bpd) from 8.42 million bpd the previous week.
Phil Flynn, a senior analyst, described the demand as fluctuating but not reaching blockbuster levels.
Crude Oil Inventory Changes:
Crude inventories fell by 1.8 million barrels to 428.4 million barrels, significantly exceeding the forecasted 605,000-barrel draw.
Net U.S. crude imports dropped to 1.4 million bpd, primarily due to a 1.6 million bpd decline in imports, while exports increased by 285,000 bpd to 4.7 million bpd.
Record Low Imports from Mexico:
Imports from Mexico fell to 151,000 bpd, marking the lowest level since records began in June 2010, with a 617,000 bpd decline noted as the largest drop since July 2020.
Pemex reported a year-on-year decrease in crude oil and condensate production for October.
Refinery Activity:
Refinery crude runs increased by 67,000 bpd, with utilization rates rising by 0.3 percentage points to 90.5% of total capacity.
Distillate stockpiles, which include diesel and heating oil, rose by 400,000 barrels to 114.7 million barrels, surpassing expectations for a 100,000-barrel increase.