Weekly US crude oil inventories jump by 7.2m b/d, DoE says

US crude oil inventories jumped sharply last week, amid a rise in net imports, but some analysts believed the build-up would be short lived.

According to the US Department of Energy, commercial crude oil stockpiles in the States grew by 7.2m barrels over the week ending on 29 March, to reach 449.5m barrels, putting them at their five-year average.

Driving the increase, net imports grew by 386,000 barrels a day as the Houston ship channel reopened, helped by a 163,000 b/d reduction in exports and purchases from Saudi, said Samuel Burman, assistant commodities economist at Capital Economics.

Meanwhile, domestic US oil output recovered 100,000 b/d-worth of production to reach 12.2m b/d.

But with Riyadh cutting output and the ongoing problems in Venezuela, "his resurgence in net imports will prove to be temporary, especially as the Brent-WTI spread remains so wide," the economist added.

Refinery utilisation rates fell by 20 basis points to "a very low" 86.4%, due to the difficulty of importing in Houston, he said.

That contributed to a 1.8m barrel drop in motor gasoline imports, pushing them 2% below their five year average for that time of year, while distillate fuel inventories shrank by 2.0m barrels to stand 6% under their five-year average.

Those of propane/propylene meanwhile were higher by 1.6m barrels and 17% above their five-year averag.

As of 1911 BST, front month West Texas Intermediate crude oil futures were down by 0.42% at $69.08 a barrel.