Crude Oil Inventories Watch: Week Ending 08/20/2010

Inventories

The Department of Energy reported that in the week ending August 20th, 2010, U.S. crude oil increased by 4.1 million barrels, gasoline inventories increased by 2.3 million barrels, distillate inventories increased by 1.8 million barrels, and total petroleum inventories increased by 8.9 million barrels.

Total petroleum inventories are now the highest in at least 20 years. The surplus now stands at 96.028 million, or 9.2% above the 5-year average, up from 8.4% in the prior week.

Crude oil inventories increased counter-seasonally. The overall surplus to the 5-year average increased to 26.2990 million barrels, or 9.4%, up from 8.0% a week ago.

Product inventories continue to relentlessly increase into record seasonal territory. Gasoline inventories are now 26.299, or 13.2% above the 5-year average and distillate inventories are 36.674, or 26.3% above the 5-year average.

Demand

Demand decreased 1.2% week-over-week. Over the last four-weeks, total petroleum demand has averaged 1.6% higher than the year ago period. Gasoline demand is up 3.0% YOY and distillate demand is up 4.9% YOY.

Imports

Crude oil imports increased 0.3 million barrels week-over-week. Over the last four weeks, imports have averaged 9.6 million barrels per day, 0.6 million barrels per day higher than the year ago period.

Refinery Activity

Refinery utilization decreased to 87.7% from 90% in the prior week. Even so, gasoline production climbed over 9.6 million barrels per day, just shy of this summer’s highs, which are also the all-time highs. Distillate production climbed higher as well.

Miscellaneous

U.S. crude oil production increased 3.0% from last week. Year-to-date oil output is up 3.7% from the year ago period.

Inventories at the NYMEX delivery point, Cushing, Oklahoma decreased 0.8 million barrels week-over-week. Prompt month calendar spreads have widened notably from -0.39 last week to -0.74 currently.