NEW YORK (Reuters) - U.S. crude stocks rose less than expected last week while inventories at the key Cushing, Oklahoma storage hub fell for an 11th straight week, according to data released by the Energy Information Administration on Wednesday.
Crude inventories rose by 2.4 million barrels in the week, which was less than the 2.7 million barrel increase analysts had forecast.
Crude stocks at the Cushing, Oklahoma, delivery hub fell 605,000 barrels, EIA said. Inventories have dropped to the lowest level since late 2014 as outages on key pipelines have limited supplies to the hub and as the start up of a new pipeline increased outflows.
Oil prices pared losses after the data as most market participants had expected a bigger increase in inventories amid refinery maintenance season.
“The smaller-than-expected inventory build led to swift short covering,” said Phillip Streible, senior market strategist at RJO Futures in Chicago.
“However I don’t believe that this strength will be long lived with rising U.S. production and a strengthening dollar.”
U.S crude production rose 0.8 percent from a week earlier to 10.37 million barrels per day (bpd) last week, according to the EIA.
In a monthly report last week, the EIA said U.S. oil output rose to 10.057 million bpd in November, a revision from earlier estimates, the EIA said. December production fell 108,000 bpd to 9.949 million bpd.
The agency expects U.S. crude output in the fourth quarter of 2018 to reach an average of 11.17 million bpd. [EIA/M]
Refinery crude runs rose by 53,000 barrels per day, EIA data showed. Refinery utilization rates rose by 0.2 percentage points.
Meanwhile, gasoline stocks fell by 788,000 barrels, a smaller decline than the 1.2 million barrel drop forecast by analysts in a Reuters poll.
Distillate stockpiles, which include diesel and heating oil, fell by 559,000 barrels, the EIA data showed, versus expectations for a 1.2 million barrels drop.
Net U.S. crude imports rose last week by 668,000 barrels per day.
Reporting by Devika Krishna Kumar in New York; Additional reporting by Stephanie Kelly; Editing by Susan Thomas and David Gregorio