U.S. crude oil and gasoline stockpiles fell last week, while distillate inventories rose, the Energy Information Administration said on Wednesday.
Crude inventories fell 2.5 million barrels in the week to June 16, surpassing analysts’ expectations for a decrease of 2.1 million barrels, as imports rose marginally by 56,000 barrels per day.
Crude stocks at the Cushing, Oklahoma, delivery hub for U.S. crude futures fell by 1.08 million barrels, EIA said.
Crude initially climbed on the report, but quickly retreated. By 11:24 a.m. (1524 GMT), U.S. crude futures were down 10 cents at $43.41 a barrel and Brent crude fell 23 cents to $45.79 a barrel.
The price gains in the report’s immediate aftermath were hard to sustain because they were not structural changes said Abhishek Kumar, Senior Energy Analyst at Interfax Energy’s Global Gas Analytics in London.
“U.S. crude and gasoline stockpiles are significantly higher compared with their five-year averages, which will weigh on prices,” Kumar said. “Meanwhile, oil output in the country is still rising despite recent declines in oil prices.”
U.S. crude production has been steadily growing and last week rose to 9.35 million bpd, up 20,000 bpd from the previous week, the EIA said.
Gasoline stocks fell 578,000 barrels, compared with analysts’ expectations for a seasonally unusual 443,000-barrel gain, which had been seen as bearish in the market.Stocks of the motor fuel had also risen unexpectedly by 2.1 million barrels in the previous week, despite the start of the summer driving season.
“Gasoline demand rebounded smartly to more normal levels for this time year, giving credence to the view that some of the lackluster demand was weather-related,” said John Kilduff, a partner at Again Capital Management.
Distillate stockpiles, which include diesel and heating oil, rose 1.1 million barrels, versus expectations for a 465,000-barrel increase, the EIA data showed.
Refinery crude runs fell by 104,000 bpd as utilization rates fell 0.4 percentage point to 94 percent of total capacity, EIA data showed. (Reporting By Jessica Resnick-Ault; Editing by Marguerita Choy)