WASHINGTON, D.C. (DTN) --- Nearest delivered oil futures on the New York Mercantile Exchange tumbled to one-week lows following the release of bearish supply data from the Energy Information Administration showing across the board builds in key U.S. oil inventories while domestic crude production increased 100,000 barrels per day (bpd) on the week.
EIA reported a 4.7 million per barrel (bbl) build in commercial crude stocks for the week ended May 17, which follows a 5.4 million bbl increase week prior, well above a 2.4 million bbl increase reported late Tuesday by the American Petroleum Institute, and contrasting with market expectations for a 2 million bbl draw. The weekly build pushed commercial stocks to a nearly 22-month high at 476.8 million bbl, and to a year-on-year surplus at 39.7 million bbl or 8.8%.
Part of the supply increase was due to a 1.1 million bbl draw from the Strategic Petroleum Reserve, while the U.S. refinery run rate fell 0.6% to 89.9%. EIA also reported U.S. crude production increased 100,000 bpd to 12.2 million bpd, holding below a record 12.3 million bpd registered in late April, and following a re-benchmarking of U.S. crude output earlier this month that lowered the production rate by 200,000 bpd.
EIA also reported an unexpected 3.7 million bbl increase in gasoline inventories to 228.7 million bbl for last week compared with market estimates stocks would show a 1 million bbl draw, and an API reported 350,000 bbl build. The build reduced a year-on-year deficit by 1.8 million bbl to 5.2 million bbl or 2.2%.
The data was also bearish for distillate fuels, with EIA reporting a 307,000 bpd decline in implied demand to 3.787 million bpd, a six-week low, and stocks increased 800,000 bbl to a four-week high at 126.4 million bbl. The market expected a 1 million bbl draw, and API reported a 237,000 bbl decline for the week profiled.
At 11:20 a.m. ET, oil futures were mostly trading near their intraday lows, with Nymex July West Texas Intermediate down $1.30 near $61.80 bbl. July Brent futures on the Intercontinental Exchange was down $1.05 near $71.15 bbl. Nymex June RBOB futures were 2.45 cents lower near $1.9950 gallon, while June ULSD futures dropped back 3.05 cents to near $2.0490 gallon.