U.S. gasoline stocks fell 1.8 million barrels to 211.58 million barrels during the reporting week ended May 23, U.S. Energy Information Administration (EIA) data showed.The larger-than-expected draw comes in the wake of Memorial Day demand in the U.S. and sent New York Mercantile Exchange (NYMEX) June RBOB more than 2 cents higher to around $3.026 per gallon shortly after the data was released.

Analysts surveyed Tuesday had been expecting a draw closer to 200,000 barrels.

EIA data showed implied demand* for gasoline rose 136,000 barrels per day (b/d) to 9.31 million b/d the week ended May 23, putting it nearly 4% above the five-year average.

On a four-week moving average, demand is up 155,000 b/d to 9.1 million b/d, nearly 466,000 b/d higher than a year ago.

"A lot of gas went on the rack to meet strong Memorial Day weekend demand," Price Futures Group analyst Phil Flynn said.

Sharp draws in the U.S. Midwest and U.S. Gulf Coast (USGC) seemed to trump a bearish 2.47 million-barrel build in U.S. Atlantic Coast (USAC) gasoline stocks, which rose to 59.24 million barrels. The USAC is home to the New York Harbor-delivered NYMEX RBOB contract.

U.S. Midwest stocks fell 2.05 million barrels to 47.18 million barrels, and USGC stocks dropped 1.43 million barrels to 72.92 million barrels.

RBOB futures have rallied since mid-day Wednesday after a tornado damaged a crude oil unit at Marathon's 490,000 b/d Garyville, Louisiana, refinery and an unspecified mechanical breakdown occurred late Tuesday at ExxonMobil's 238,000 b/d Joliet, Illinois, refinery.

The outages come amid seasonal turnarounds at both the 600,000 b/d Saudi Aramco/Shell joint venture Motiva refinery in Port Arthur, Texas, and ExxonMobil's 502,500 b/d Baton Rouge, Louisiana, refinery. Despite the obvious bullish effect on futures, these outages will only be reflected in next week's data release.

EIA data showed U.S. gasoline production surged 229,000 b/d to 10.55 million b/d the week ended May 23. While USAC production edged 19,000 b/d lower to 3.23 million b/d, USGC gasoline production jumped 200,000 b/d to 2.34 million b/d.

USAC gasoline imports were down 293,000 b/d to 686,000 b/d. But a four-week moving average showed imports around 766,000 b/d, the highest since the week ended August 31, 2012.

This time last year, USAC imports on a four-week moving average were around 630,000 b/d.

U.S. distillate stocks were down 196,000 barrels to 116.08 million barrels, counter to analysts' estimates of a 290,000 barrel build. The draw was likely aided by sharply higher demand.

Implied demand for distillates soared 410,000 b/d to 4.2 million b/d the week ended May 23, EIA data showed.

Ultra-low sulfur diesel stocks on the USGC fell 1.62 million barrels to 30.15 million barrels.

U.S. CRUDE OIL STOCKS UP 1.66 MILLION BARRELS

U.S. commercial crude oil stocks rose 1.66 million barrels to 392.95 million barrels the week ended May 23, largely in line with analysts' expectations.

USGC stocks rose 3.14 million barrels to 213.13 million barrels as crude oil runs in the region dropped 138,000 b/d to 8.13 million b/d, and imports rebounded 1.08 million b/d to 3.92 million b/d.

This helped to drive total U.S. crude oil imports 1.34 million b/d higher to 7.81 million b/d.

Imports from Saudi Arabia were up 419,000 b/d to 1.59 million b/d, while those from Venezuela rose 255,000 b/d to 853,000 b/d. Colombian imports rose 211,000 b/d to 402,000 b/d.

Imports from Nigeria rose 192,000 b/d to 210,000 b/d, but imports from Angola fell 81,000 b/d to 151,000 b/d.

And while crude oil runs in the USGC were sharply lower, gross inputs, which include feedstocks other than crude oil, actually rose 146,000 b/d to 8.23 million b/d.

This boosted run rates in the region by 1.6 percentage points to 89.9% of capacity.

Total U.S. refinery utilization rates rose 1.2 percentage points to 89.9% of capacity, about double analysts' expectations.

Stocks at Cushing, Oklahoma -- delivery point for the NYMEX crude oil futures contract -- fell 1.53 million barrels to 21.69 million barrels the week ended May 23

* Implied demand is the amount of product that moves through the U.S. distribution system, not actual end consumption.
Source: Platts