U.S. crude inventories slump amid near record refining: EIA

(Reuters) - U.S. crude oil inventories fell for the seventh straight week as refiners processed a near record amount of crude last week, the Energy Information Administration said on Wednesday, even as gasoline and distillate stockpiles also dipped.

Crude oil storage tanks are seen from above at the Cushing oil hub, in Cushing, Oklahoma, March 24, 2016. Picture taken March 24, 2016. REUTERS/Nick Oxford

Crude inventories fell 4.4 million barrels in the week ended May 19, more than analysts’ forecasts of a 2.4 million-barrels decline.

At 516.3 million barrels, U.S. crude inventories were the smallest since mid-February, a sign that OPEC’s efforts to reduce world supply are starting to have an effect in the United States, the world’s largest oil consumer.

The data comes one day before the Organization of the Petroleum Exporting Countries, along with non-member nations, are scheduled to decide whether to extend its agreement to cut world supply, an effort that has only recently started to bear fruit in global inventory figures.

Refinery crude runs rose 159,000 barrels per day to 17.281 million bpd last week, the second highest volume of crude processed since the EIA began collecting the data in 1982. The record volume was 17.285 million bpd in late April.

Refinery utilization rates edged up 0.1 percentage points to 93.5 percent of nationwide capacity. Refiners have come back from spring turnarounds at full throttle with rates above 90 percent for eight straight weeks, including a record of 94.1 percent in late April.

“Gasoline demand is picking up in the U.S., which also resulted in larger-than-expected crude drawdown despite higher oil production and imports,” said Abhishek Kumar, senior energy analyst at Interfax Energy’s Global Gas Analytics in London.

Refiners have said product exports are supporting the high refining rates. Product exports have averaged 4.7 million bpd over the last four weeks, the EIA data showed, up more than 30 percent than this time a year ago.

U.S. crude production rose to 9.32 million bpd from 9.301 million bpd and crude imports rose slightly by 165,000 bpd.

Crude stocks at the Cushing, Oklahoma, delivery hub for crude futures fell by 741,000 barrels, EIA said.

Crude futures rose briefly on the data. But an hour later, by 11:30 a.m. U.S. crude was down 8 cents at $51.39 a barrel after touching $51.88 a barrel, highest since April 19.

Gasoline stocks fell 787,000 barrels, compared with expectations in a Reuters poll for a 1.2 million-barrel drop.

Distillate stockpiles, which include diesel and heating oil, fell by 485,000 barrels, versus expectations for a 743,000-barrel drop, the EIA data showed.

Reporting by David Gaffen; Additional reporting by Jarrett Renshaw and Scott DiSavino; Editing by Marguerita Choy