Total crude oil and petroleum products stocks increased for a 12th week, by +4.04 mmb, to 1143.35 mmb in the week ended August 27. Crude oil inventory gained +3.43 mmb to 361.71 mmb as driven by the builds in the Gulf Coast and the Rocky Mountain. Cushing stock dropped for a third week, by -0.50 mmb, to 35.75 mm. Utilization rate dipped -0.7% to 87.7%.

Stockpiles for oil products dropped in the reporting week with gasoline slipping -0.21 mmb to 225.41 mmb and distillate losing -0.74 mmb to 175.24 mmb. Despite a less-than-expected draw, this is the first time since April 2 that distillate stockpile declined. For gasoline, demand climbed +0.12% to 9.39M bpd, production plunged -3.25% to 9.31M bpd and imported dropped -19.01% to 1.14M bpd. Distillate demand jumped +8.24% to 3.93M bpd while production slid -2.03% to 4.30M bpd. Imports, however, soared -20.25% to 0.20M bpd.

WTI crude oil price tumbled below 72 earlier in the day as the market worried about downside risks of US ISM manufacturing data. Surprisingly, the reading beat market expectations and rose from 55.5 to 56.3 in August. Crude oil price then rebounded sharply to 74.48.

Weekly change in inventory as of 27/08/10 ActualChangeMarket Expectation Previous
Crude oil 361.71 mmb+3.43 mmb+1.55 mmb+4.11 mmb
Gasoline 225.41 mmb-0.21 mmb-0.38 mmb+2.27 mmb
Distillate 175.24 mmb-0.74 mmb+1.00 mmb+1.76 mmb

Comparison between API and EIA reports:

API (Aug 27)

EIA (Aug 27)

Forecast (using API's inventory level)Inventory
Crude oil+4.70 mmb361.46 mmb-1.85 mmb

+3.18 mmb

361 mmb
Gasoline-0.90 mmb225.33 mmb+1.88 mmb
-0.29 mmb225 mmb
Distillate-1.80 mmb167.80 mmb+0.69 mmb
-8.17 mmb168 mmb

API collects stockpile information on a voluntary basis from operators of refineries, 76% of the time, using data in the past 4 years.

Source: Bloomberg, API, EIA