U.S. crude stockpiles drop, fuel stocks rise: EIA

(Reuters) - U.S. crude stocks fell more than expected in the last week, while gasoline and distillate inventories rose as refiners ramped up output to its highest level since August, the Energy Information Administration said on Wednesday.

FILE PHOTO: A pumpjack is shown outside Midland-Odessa area in the Permian basin in Texas, U.S., July 17, 2018. Image taken July 17, 2018. REUTERS/Liz Hampton

Crude inventories fell by 3.2 million barrels in the week to Jan. 8 to 482.2 million barrels, compared with expectations in a Reuters poll for a 2.3 million-barrel drop.

Refinery crude runs rose by 274,000 barrels per day in the last week, EIA said. Refinery utilization rates rose by 1.3 percentage points, in the week, boosting overall refining use to 82% of capacity, highest since August.

“I think what we’re seeing here is the drawdown in supply and a big uptick in refinery runs is giving the market an idea that refiners are starting to ramp up production of products,” said Phil Flynn, senior analyst at Price Futures Group in Chicago.

Prices dipped initially on the report before rebounding to near-unchanged. As of 10:43 a.m. EST (1543 GMT), U.S. futures rose 5 cents to $53.26 a barrel while Brent crude slipped 14 cents to $56.44 a barrel.

U.S. gasoline stocks rose by 4.4 million barrels in the week to 245.5 million barrels, compared with expectations for a 2.7 million-barrel rise.

Fuel demand remains low, with the four-week average of gasoline product supplied down 11% from the year-earlier period. Consumers continue to use less fuel as they restrict their movements due to coronavirus.

Distillate stockpiles, which include diesel and heating oil, rose by 4.8 million barrels in the week, versus expectations for a 2.7 million-barrel rise.

Net U.S. crude imports rose by 1.5 million barrels per day, EIA said.

Crude stocks at the Cushing, Oklahoma, delivery hub fell by 2 million barrels in the last week, EIA said.

Reporting By David Gaffen; additional reporting by Laila Kearney and Laura Sanicola