US crude inventories fall on steady refinery runs, export surge

US crude inventories fell 5.1 million barrels to 460.9 million barrels the week ended April 21 as refinery runs were steady and exports climbed, US Energy Information Administration data showed April 26.

Crude stocks have fallen 20.3 million barrels since the middle of March as refiners have exited maintenance. While net refinery crude inputs at 15.8 million b/d the week ended April 21 were roughly unchanged, they were up 866,000 b/d from early March.

S&P Global analysts on April 21 said they expect US refinery outages to decrease by another 470,000 b/d for the week ended April 28. However, crude runs could decline as over the weekend as several Texas refineries were impacted by power outages, including three Corpus Christi plants, and TotalEnergies' Port Arthur plant.

The crude stock draw left US inventories at a slight deficit to the five-year average, down from a 9% surplus in mid-February, the EIA data showed.

The bulk of the crude stock draw was seen in the US Gulf Coast, where inventories fell 5.4 million barrels to 259.9 million barrels.

The draw would likely have been larger were it not for the release of another 1 million barrels of crude from the US Strategic Petroleum Reserve, as SPR crude is either run through refineries, exported or placed into commercial storage.

SPR stocks have fallen 4.6 million barrels since the week ended March 24 as part of the US Department of Energy's plan to draw 26 million barrels between April 1 and the end of June. US Energy Secretary Jennifer Granholm has said that refilling of the SPR could begin in the second half of the year, following a record 180-million barrel release last year to combat high energy prices.

A rise in US crude exports also contributed to the crude stock draw last week. Exports jumped 248,000 b/d to 4.8 million b/d, the EIA data showed. Exports on four-week moving average at 4.3 million b/d were up nearly 900,000 b/d on the year.

S&P Global Commodities at Sea shows the US exporting 4.9 million b/d the week ended April 21, with increased flows seen to Northwest Europe, South Korea and China.

The spot arbitrage remains open for US crudes into Europe, with WTI MEH fetching a roughly $3/b premium to Forties, S&P Global refining margins data shows.

In refined products, US gasoline inventories fell 2.4 million barrels to 221.1 million barrels last week, the EIA data showed. Stocks on the US Atlantic Coast fell 1.1 million barrels to 51.4 million barrels, causing the deficit to the five-year average to widen to 17%.

The USAC draw was supportive for the New York-delivered NYMEX RBOB contract. While the outright RBOB price fell April 26, the NYMEX RBOB crack spread against WTI crude settled 85 cents higher at $31.23/b.

US gasoline stocks fell despite a 541,000 b/d increase in production to 10 million b/d, a 209,000 b/d decrease in exports to 734,000 b/d, and a 316,000 b/d increase in imports to 838,000 b/d.

As a result, the EIA showed implied gasoline demand jumping 992,000 b/d to 9.5 million b/d. Implied demand is a computation and does not reflect true consumption.

US distillate stocks fell 577,000 barrels to 111.5 million barrels. However, USAC distillate stocks edged up 197,000 barrels to 27.1 million barrels, causing the deficit to the five-year average to narrow slightly to 27%.

Distillate stocks are tight, but with winter heating season over, and broader economic concerns expected to slow industrial consumption, crack spreads are under downward pressure.

The New York-delivered NYMEX ULSD crack spread against WTI crude settled at $25.21/b April 26, down 52 cents on the day, and down from $36.28/b on March 20.