U.S. crude inventories unexpectedly fall from record high; refiners in overdrive

(Reuters) - U.S. crude oil inventories unexpectedly fell from record highs last week as refineries continued to hike output and imports fell, while gasoline stocks rose, snapping a six-week decline, data from the Energy Information Administration showed on Wednesday.

A pump jack operates at a well site leased by Devon Energy Production Company near Guthrie, Oklahoma September 15, 2015. REUTERS/Nick Oxford

Crude inventories USOILC=ECI fell 4.9 million barrels in the week to April 1, compared with analysts' expectations for an increase of 3.2 million barrels.

Crude stocks at the Cushing, Oklahoma, delivery hub for U.S. crude futures USOICC=ECI rose 357,000 barrels, EIA said.

U.S. crude oil prices CLc1 extended gains after release of the data, rising by as much as 2 percent, or 72 cents, in the following 15 minutes.

The EIA report was “modestly supportive” with the jump in refinery runs and fall in imports “obvious catalysts in causing overall crude oil inventories to decline,” said John Kilduff, a partner at New York energy hedge fund Again Capital.

U.S. crude imports USOICI=ECI fell 446,000 barrels per day, with some pointing to weather issues in the Houston Ship Channel last week.

Refinery crude runs USOICR=ECI, which have remained at record seasonal levels for most of this year thanks to unusually strong gasoline margins, rose by 199,000 bpd, EIA data showed.

Refinery utilization rates USOIRU=ECI rose 1 percentage point to 91.4 percent of total capacity, although usage could ebb with more maintenance expected this month.

“For refiners, they see a market with strong demand for gasoline and decent profit margins. I expect they will begin ramping up in order to capture the sweet spot of high volume and high margins for as long as it lasts,” said David Thompson, executive vice-president at energy-specialized commodities broker Powerhouse in Washington.

U.S. gasoline demand over past four weeks was at 9.36 million, up 4.2 percent from a year ago.

Gasoline stocks USOILG=ECI, which swelled this winter to record highs and remain at unusually high levels for this time of year, rose 1.4 million barrels after six consecutive declines, compared with expectations for a 1.0 million-barrel drop.

Distillate stockpiles USOILD=ECI, which include diesel and heating oil, rose 1.8 million barrels, versus expectations for a 333,000-barrel drop, the EIA data showed.

Reporting By Jonathan Leff, Barani Krishnan and Catherine Ngai in New York; Editing by Marguerita Choy