June 28, 2017 / 3:24 PM / a year ago

UPDATE 1-U.S. crude stockpiles edge higher, gasoline draws down - EIA

(Adds details, prices, background, quotes)

By David Gaffen

June 28 (Reuters) - U.S. crude oil inventories edged up last week while gasoline stocks decreased, the Energy Information Administration said on Wednesday, providing a modest lift to oil prices that have been pressured by an ongoing supply glut.

Crude inventories rose 118,000 barrels in the week ending June 23, compared with forecasts for a 2.6 million-barrel decrease, as imports rose 129,000 barrels per day and refinery runs fell 262,000 bpd.

Gasoline stocks fell 894,000 barrels, compared with expectations for a 583,000-barrel drop. But current gasoline inventories of 241 million barrels remains about 7.5 percent higher than the seasonal average for stocks over the past five years.

Those high inventories have squeezed refining profits. The current gasoline crack spread RBc1-CLc1 on the New York Mercantile Exchange, an indicator of refining margins, of $16.53 a barrel is $3 lower than the five-year average of $20.56, as heavy supply is hurting refiners even in the midst of the summer driving season.

“U.S. gasoline stocks remaining above its five-year average underscores demand concerns in the market,” said Abhishek Kumar, senior energy analyst at Interfax Energy’s Global Gas Analytics in London.

Demand for the motor fuel over the past four months was down 2.4 percent from the same period a year ago, the EIA said.

Gasoline demand was slack at the outset of 2017, but has picked up in recent weeks, and the American Automobile Association expects a record number of U.S. motorists will drive more than 50 miles (80 km) from home over the coming Fourth of July holiday weekend.

Oil prices rose following the report. U.S. crude futures was 55 cents higher at $44.79 a barrel as of 10:57 a.m. EDT (1457 GMT), while Brent futures rose 62 cents to $47.27 a barrel.

Stocks at the Cushing, Oklahoma, delivery hub for U.S. crude futures fell 297,000 barrels, the EIA said.

U.S. crude production fell 100,000 bpd to 9.25 million bpd last week, the EIA said.

That is “a significant decline given the increases in previous weeks and that is supporting crude futures today,” Andrew Lipow, president of Lipow Oil Associates in Houston, said, noting some of that production decline was likely due to Tropical Storm Cindy, which briefly shut some operations in the Gulf of Mexico last week.

Refinery utilization rates fell 1.5 percentage points to 92.5 percent of operable capacity, EIA data showed.

Distillate stockpiles, which include diesel and heating oil, fell by 223,000 barrels, versus expectations for a 453,000-barrel increase, the EIA said. (Reporting By David Gaffen and Scott DiSavino; Editing by Marguerita Choy)

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