Investing.com – US crude stockpiles jumped more than 10 million barrels last week, their most in eight months, as exports tumbled and refineries slowed processing of oil amid maintenance, while output from the world’s largest producer of the commodity hit a new record high of 13.2 million barrels per day, government data showed on Thursday.
The US rose by 10.176 million barrels during the week to Oct. 6, the most since a weekly rise of 16.283M in mid-February, according to the Weekly Petroleum Status Report of the Energy Information Administration, or EIA. In the prior week to Sept. 29, crude inventories saw a draw of 2.224M barrels.
Industry analysts tracked by Investing.com had predicted a crude draw of 1.4M barrels instead for last week.
US crude production jumps 300,000 barrels daily to reach record high
But more riveting than that crude inventory spike was the EIA’s estimate of crude production in the just-ended week, which the agency put at 13.2M barrels per day — up 300,000 from the prior week. It was the highest ever government estimate on crude production, which prior to this had not exceeded the 13.1M peak reached just before the March 2020 outbreak of the coronavirus pandemic that decimated crude demand.
The EIA has been estimating higher crude production for the United States in recent months, citing higher efficiency in output at US shale oil basin despite a sheer cutback in the number of oil rigs actively deployed by drillers.
“It’s staggering how far US oil production has come in just a few months this year to reach this record high cited by the EIA,” said John Kilduff, partner at New York energy hedge fund Again Capital.
Crude exports slow after hitting peak in Q3
As for crude stockpiles, they ballooned last week as exports, often a juggernaut in the weekly EIA report, fell almost 2 million barrels to reach 3.067M per day versus the 4.956M per day level during the week to Sept. 29.
Crude exports hit a record high just shy of 4 million barrels per day in the first half of the year, the EIA said in a separate report on Wednesday.
Processing of into fuel and other products also dropped last week, by almost 2%, to 85.7% as refineries went into maintenance.
“It’s the combination of lower exports and lower refinery runs that led to this humongous build in crude stockpiles,” observed Kilduff.
While crude stocks rose, inventories of gasoline fell last week after the biggest build in nearly two years the prior. fell by 1.313 million barrels last week versus a forecast drop of 1.0M and the prior week’s build of 6.481M. Gasoline is the No. 1 US fuel product.
also fell by 1.837M last week, more than the forecast 1.0M and adding to the previous drop of 1.269M. Distillates are refined into , diesel for trucks, buses, trains and ships and fuel for jets.
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