U.S. crude oil stockpiles rose unexpectedly last week to their highest in nearly two years, while gasoline and distillate inventories fell, the Energy Information Administration said on Wednesday.
Crude inventories rose by 1.1 million barrels in the week to March 17 to 481.2 million barrels, their highest since May 2021. Analysts in a Reuters poll had expected a 1.6 million-barrel drop.
Oil inventories have mostly built since mid-December, the data showed.
The build “is obviously a concern for the bulls here,” said Bob Yawger, director of energy futures at Mizuho. “We just have a lot of crude oil in storage and it’s not going to go away any time soon as it looks like we keep on posting builds.”
Oil futures turned positive after the data and were last up about 0.8% with Brent crude futures at $75.93 a barrel and U.S. crude futures at $70.25.
Inventories on the East Coast, however, fell to 6.53 million barrels, the lowest on record, even as refinery utilization in the region fell to the lowest since February 2021, the data showed.
Crude stocks at the Cushing, Oklahoma, delivery hub fell by 1.1 million barrels last week, the EIA said.
Refinery crude runs fell by 22,000 barrels per day (bpd) and refinery utilization rates rose by 0.4 percentage point in the week.
Gasoline stocks fell by 6.4 million barrels to 229.6 million barrels, the EIA said, compared with analysts’ expectations for a 1.7 million-barrel drop.
Distillate stockpiles, which include diesel and heating oil, fell by 3.3 million barrels in the week to 116.4 million barrels, versus expectations for a 1.5 million-barrel drop, the data showed.
Net U.S. crude imports rose last week by 51,000 bpd, the EIA said.
The EIA said it would change calculations and surveys around its weekly oil inventory data to combat recently high adjustment figures.
The administration posted a nearly 2 million bpd crude oil adjustment in Wednesday’s data. In late February, that figure had soared to 2.27 million bpd, the highest adjustment on record.
The EIA stated earlier this month that crude oil blending and under-reported oil output were key reasons for the high adjustment numbers.
The administration estimates the crude oil adjustments in 2022 could have been 500,000 bpd less than reported, it said on Wednesday.
To address overstated crude oil disposition, the EIA will introduce a new column into its supply and disposition tables called Transfers to Crude Oil Supply, it said, adding it hopes to make this change around August.
The administration will also make changes to its surveys to address understated crude oil supply. It is developing additional questions to add to its survey forms and plans to publish a new product code on a natural gas plant processing survey early in 2024.