Investing.com - US crude stockpiles possibly fell as much as 2.7 million barrels last week, petroleum trade group API said Tuesday, reporting a second straight week of declines that suggested that strong exports were again influencing inventories.
Declines were also seen in inventories of gasoline, the premier US fuel product and, distillates — a feedstock for diesel and heating fuel, the weekly inventory report from the API, or American Petroleum Institute, showed.
Typically at this time of year, demand for fuels is softer in the United States as fewer families do trip roads with children back in school or college. But with the refinery industry on seasonal maintenance, larger-than-usual declines in fuel stocks are also common with limited replenishments coming in.
The U.S. crude inventory balance fell by 2.668M barrels during the week ended Oct. 20, according to the API. That was in addition to the 4.383M-barrel crude inventory slump during the prior week to Oct. 13, helped largely by a spike in exports.
Notwithstanding the headline crude draw, the API noted a 0.513M barrel build at the Cushing, Oklahoma storage hub which serves as delivery point for US West Texas Intermediate crude futures traded on the New York Mercantile Exchange. Cushing storage levels have dropped drastically this year, prompting concerns they might reach such critical lows to complicate operations at the storage hub. Last week, the storage hub saw a net outflow of 1.005M barrels.
On the fuel side, the petroleum trade group reported a gasoline inventory slide of 4.169MM barrels and distillate stock drop of 2.313M barrels. In the prior week, gasoline saw a 1.578-M barrel deficit while distillates experienced a 0.612M drop.
The API data serves as a precursor to official inventory data on the same due from the US Energy (NASDAQ:USEG) Information Administration, or EIA, on Wednesday.
For last week, analysts tracked by Investing.com expect the EIA to report a crude stockpile drop of 0.55M barrels, to add to the 4.491M-barrel reduction reported during the week to Oct 13.
On the gasoline inventory front, the consensus is for a draw of 0.1M barrels over the 2.371M-barrel decline in the previous week. Automotive fuel gasoline is the No. 1 U.S. fuel product.
With distillate stockpiles, the expectation is for a drop of 1M barrels versus the prior week’s deficit of 3.185M. Distillates are refined into heating oil, diesel for trucks, buses, trains and ships and fuel for jets.