U.S. commercial crude oil stocks rose 2.147 million barrels in the week that ended Friday, Energy Information Administration data showed this week. Stocks have risen nearly 22 million barrels over the last six reporting periods, pushing inventories into record-high territory. At 504.105 million barrels, crude stocks sit 36.3% above the five-year average for this time of year.

Analysts surveyed Tuesday by Platts expected a slightly larger build of 3.3 million barrels last week.

Crude runs increased 338,000 b/d to 15.848 million b/d, helping offset the size of last week's build. It was the first time the amount of crude processed by refiners rose on a week-on-week basis since late December, raising the possibility that facilities have returned from performing seasonal maintenance.

Refinery utilization rose 2.2 percentage points to 88.3% of operable capacity. Analysts expected a decrease of 0.5 percentage point.

On the U.S. Gulf Coast, home to more than half of U.S. operable crude distillation capacity, refinery utilization increased 3.1 percentage points to 87.8%.

A steady drop in refinery utilization since late December had been driving stocks higher. In the week that ended February 5, crude runs were 1.172 million b/d lower than during Christmas week.

With the end of the winter turnaround season, refinery demand usually begins to climb steadily into the summer.

Oil traders may be viewing last week's increase in crude runs as signaling the start of higher refinery demand, which would be supportive for prices.

Prompt-month New York Mercantile Exchange (NYMEX) crude oil futures fell sharply immediately after the release of the EIA data, hitting an intraday low of $30.54/b, but then headed higher. Prompt-month NYMEX crude oil futures were trading up 20 cents at $30.86/b Thursday afternoon.

In addition, last week's build was mainly due to imports, which can fluctuate sharply on a weekly basis depending on how even a single tanker is accounted for.

Imports rose 795,000 b/d last week to 7.919 million b/d. By country of origin, the biggest increases came from Venezuela (up 459,000 b/d to 863,000 b/d) and Kuwait (up 439,000 b/d to 591,000 b/d).

Gulf Coast imports increased 398,000 b/d last week to 2.897 million b/d. U.S. Atlantic Coast (USAC) imports rose 237,000 b/d to 958,000 b/d.

Midwest imports fell 116,000 b/d to 2.552 million b/d. Canadian imports, most of which enter the U.S. through the Midwest, were 199,000 b/d lower at 3.247 million b/d.

Despite the drop in imports, Midwest crude stocks rose 2.247 million barrels last week to 154.969 million barrels as the region's refinery activity slowed.

Stocks at Cushing, Oklahoma -- delivery point for the NYMEX crude futures contract – increased 36,000 barrels last week.

At 64.733 million barrels, the hub's inventory stood at 89% of working capacity last week, and 87% of working capacity adjusted to reflect pipeline space and crude in transit, the EIA data showed.

That was up from 71% of adjusted working capacity at the end of October.

EIA data showed production in the Lower 48 States fell 50,000 b/d on a week-over-week basis, to 8.623 million b/d. Alaskan output was little changed, down 1,000 b/d to 512,000 b/d.

GASOLINE, DISTILLATE STOCKS RISE

U.S. gasoline inventories increased 3.036 million barrels last week to 258.693 million barrels, EIA data showed. Analysts were looking for a decline of 1 million barrels.

And with refinery utilization rising, gasoline production rose 122,000 b/d to 9.675 million b/d, the highest level since the week ending December 25.

Implied* demand increased 81,000 b/d to 9.203 million b/d.

Stocks on the Atlantic Coast, home to the New York Harbor-delivered NYMEX reformulated blend stock for oxygenate blending (RBOB) futures contract, rose 1.710 million barrels to 70.473 million barrels.

In the Midwest, where refinery utilization fell 1.1 percentage points to 94.5% of operable capacity, gasoline stocks fell 1.502 million barrels to 61.349 million barrels.

Before last week's draw, Midwest gasoline stocks were at their highest level since 1993.

Distillate stocks rose 1.399 million barrels to 162.375 million barrels. Analysts had expected inventories to decrease 1.8 million barrels.

Combined stocks of low- and ultra-low sulfur diesel (ULSD) were down 2.215 million barrels, offsetting the size of the total build.

At 51.861 million barrels, USAC combined stocks sit 109% above the five-year average for this time of year.
Source: Platts