On Thursday, January 22, data released by the U.S. Energy Information Administration (EIA) showed that U.S. crude oil, gasoline, and distillate fuel inventories all increased last week due to a sharp decline in demand from refineries and consumers.
The EIA said that in the week ending January 16, U.S. crude oil inventories increased by 3.6 million barrels to 426 million barrels, while analysts had previously estimated an increase of 1.13 million barrels.
Crude oil inventories at the Cushing, Oklahoma storage hub increased by 1.48 million barrels during the week.
Following the release of the report, Brent and U.S. crude oil futures, heating oil, and gasoline futures all extended their losses.
UBS analyst Giovanni Staunovo said: "The EIA released another set of bearish data, with significant increases in crude oil, distillate fuel, and gasoline inventories as demand weakens seasonally. We will observe whether cold weather will soon affect production, refineries, and product demand."
The EIA said that refinery crude oil processing decreased by 354,000 barrels per day last week, and refinery utilization fell by 2 percentage points to 93.3%.
Total oil product supply, a measure of demand, decreased by 836,000 barrels per day to 20.17 million barrels per day last week. Gasoline demand decreased by 470,000 barrels per day to 7.83 million barrels per day, the lowest level since January 2023, while distillate fuel demand decreased by 571,000 barrels per day to 3.52 million barrels per day.
The EIA said that in the week ending January 16, U.S. gasoline inventories increased by 6 million barrels to 257 million barrels, the highest level since February 2021, while analysts had previously expected an increase of 1.71 million barrels.
Distillate fuel inventories, including diesel and heating oil, rose to their highest level since January 2024, increasing by 3.35 million barrels to 132.6 million barrels, while analysts had expected a decline of 162,000 barrels. Distillate fuel inventories on the U.S. Gulf Coast reached their highest level since August 2021.
The EIA reported that U.S. net crude oil imports decreased by 27,000 barrels per day last week.
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