US crude inventories rise more than expected: EIA

NEW YORK: US crude oil stockpiles rose much more than expected last week, while gasoline and distillate inventories fell more than forecast, drawing down for the third consecutive week as refining rates remained low, the Energy Information Administration said on Wednesday.

Crude inventories rose 7.1 million barrels in the week to March 1, far exceeding analysts' expectations for an increase of 1.2 million barrels.

Stocks at the Cushing, Oklahoma, delivery hub for U.S. crude futures rose for the third consecutive week, increasing 873,000 barrels to 47.5 million barrels, the highest since December 2017, the EIA said.

U.S. crude futures extended losses after the data release, falling to a session low of $55.42 a barrel. The contract traded at $55.85, down 70 cents in the session, by 10:54 a.m. EDT (1554 GMT).

U.S. gasoline futures turned positive after the report, trading up 1.03 cents a gallon at $1.7777.

Refinery crude runs rose by 100,000 barrels per day, the data showed. Refinery utilization rates rose by 0.4 percentage point to 87.5 percent of total capacity.

"The drop in refined fuel inventories is a result of the low refinery run rates," said John Kilduff, a partner at Again Capital LLC in New York. "Gasoline demand is picking back up, which is a supportive feature of the report," he said.

Gasoline stocks fell by 4.2 million barrels, compared with analysts' expectations in a Reuters poll for a 2.1 million-barrel drop.

"Three straight weeks of declines in gasoline inventories are starting to have an effect," said David Thompson, executive vice president at Powerhouse, an energy-specialized commodities broker in Washington. "While gasoline stocks are in no way tight, the supply glut is starting to recede."

Distillate stockpiles, which include diesel and heating oil, fell by 2.4 million barrels, versus expectations for a 1.4 million-barrel drop, the EIA data showed.

Net U.S. crude imports rose by 1.6 million bpd and production held at last week's record highs at 12.1 million bpd.