US refined products inventories likely climbed the week ended June 2 as refiners continued to increase runs, and as gasoline imports climbed.
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Register NowAnalysts polled by S&P Global Commodity Insights on average were looking for US gasoline inventories to have climbed 750,000 barrels and US distillate inventories to have climbed 1 million barrels.
A 750,000-barrel build would put gasoline stocks at 216.8 million barrels, roughly 9% below the five-year average, according to the most recent US Energy Information Administration data.
Gasoline inventories are tight even as refiners have returned from maintenance, and have boosted net crude inputs by 1.2 million b/d since early March to 16.2 million b/d.
Analysts were looking for inputs to have edged even higher, however. Also, low inventories on the US Atlantic Coast have boosted prices, opening the arbitrage for imports.
USAC gasoline stocks at 53.2 million barrels the week ended May 26 were 16% below the five-year average.
The gasoline arbitrage from Europe to the USAC is wide open, with Northwest European barrels at an $8.35/b incentive in New York Harbor as of June 1, according to S&P Global data.
S&P Global Commodities at Sea shows US gasoline imports jumping to 1.2 million b/d the week ended June 2, up from 833,000 b/d reported by the EIA for the week ended May 26.
But export demand is also strong, which helps to explain why inventories are so low even as refiners have upped runs. CAS shows the US exporting 1.1 million b/d of gasoline the week ended June 2.
US distillate stocks are also tight, and a 1-million barrel build would put inventories at 107.7 million barrels, 19% below the five-year average.
Export demand is also strong for US distillates, with CAS showing the US exporting 1.2 million b/d the week ended June 2.
The rise in refinery net inputs should help draw down US crude inventories. Analysts polled by S&P Global on average were looking for US crude stocks to have fallen by 1 million barrels the week ended June 2.
US crude exports likely slipped from the 4.9 million b/d level reported by the EIA for the week ended May 26. Import also likely fell from the 7.2 million b/d figure reported by the EIA.
US crude inventories have fallen 21.5 million barrels since mid-March to 459.7 million barrels the week ended May 26, largely because of higher refinery runs.
However, withdrawals from the US Strategic Petroleum Reserve have limited the commercial stock draws.
SPR stocks have fallen 16.1 million barrels since March 24 to 355.4 million barrels as part of a congressionally mandated sale of 26 million barrels, with deliveries to be completed by the end of June.