NYMEX Crude/inventory Build-3: Strong Demand Seen Bullish
The build in crude stocks came amid exceptionally strong import volumes.
Inventories rose to 322.239 million barrels, up from 309.517 million barrels,
as imports of crude oil, contrary to most analysts' expectations, climbed to
9.532 million barrels a day, the data showed.
The strong import volume more than offset an increase in refinery
utilization, which jumped 1.7 percentage points to 95.4% of operable capacity,
almost catching up with last year's very high rate of 96.6%, the data showed.
The API revised up last week's crude stock figures by 1.763 million barrels
to 319.578 million barrels.
The decline in gasoline and distillate stocks came amid unusually strong
demand for petroleum products.
Gasoline stocks fell to 216.424 million barrels, as gasoline demand jumped to
9.57 million barrels a day from 9.06 million barrels a day the prior week. The
draw came despite daily gasoline imports of 774,000 barrels a day.
Distillate stocks fell to 126.815 million barrels, as demand for distillate
fuels rose to 4.07 million barrels a day from 3.989 million barrels a day the
prior week.
Phil Flynn, an analyst at Alaron Trading Corp., said the surge in demand for
petroleum products reflected a strong pickup in economic activity.
"This would be a wildly bullish report if it wasn't for the build in crude
stocks," Flynn said. "It shows that the economy is really strong regardless of
what's happening in the stock market. Down on the street, people are driving
their cars, doing their summer thing."
Still, he acknowledged that the bearish crude figure is hard to shrug off.
"That's the one thing that's weighing on the market," he added. "It shows
that there is no shortage of crude. Even though demand is strong, refiners are
not going to lack crude."
-By Masood Farivar, Dow Jones Newswires; 201-938-2094;
masood.farivar@dowjones.com |
