U.S. crude oil stockpiles last week posted a large build that took analysts by surprise, as inventories in the Cushing, Oklahoma, storage hub gained while the market continued to recover from a winter storm last month, data from the Energy Information Administration showed on Thursday.
Winter Storm Elliott last month brought subfreezing temperatures and extreme weather alerts to about two-thirds of the United States, forcing oil and gas well freeze-ins at the time.
Crude inventories rose by 8.4 million in the week to Jan. 13 to about 448 million, their highest since June 2021, EIA data showed. Analysts in a Reuters poll had expected a 593,000-barrel drop.
Crude stocks at the Cushing, Oklahoma, delivery hub rose by 3.6 million barrels to 31.4 million, the highest since January 2022, the data showed.
“It’s all a function of the freeze-in still,” Bob Yawger, director of energy futures at Mizuho in New York, said of the build at Cushing. “Nobody is in a hurry to bring back refineries.”
“Until that happens, you’re not going to get a draw,” he added.
Crude production held steady last week at 12.2 million barrels per day and net U.S. crude imports fell by 1.2 million bpd.
Refinery utilization rates rose by 1.2 per cent to 85.3 per cent of total capacity. Utilization rates, however, were above 90 per cent before the storm.
Refinery crude runs rose by about 202,000 bpd.
Gasoline stocks rose by about 3.5 million barrels in the week, the EIA said, compared with analysts’ expectations for a 2.5 million-barrel gain.
Distillate stockpiles, which include diesel and heating oil, fell by 1.9 million barrels in the week, versus expectations for a 122,000-barrel build, the data showed.
Oil prices were mixed on the data and pared gains before recovering. Brent crude futures rose 88 cents to trade at $85.86 a barrel by 11:40 a.m. EST (1640 GMT). U.S. crude futures rose 56 cents to $80.04 a barrel.