(XOM) Crude and Oil Product Inventories Rise

The U.S. Energy Department’s weekly inventory release showed that crude stockpiles logged a slim build that was well below analyst forecast. The agency’s report further revealed that gasoline and distillate stocks rose from their previous week levels, as product demand continues to be weak. Meanwhile, refinery utilization rate was up by 1.0%.

The Energy Information Administration (“EIA”) Petroleum Status Report – which contains data for the previous week ending Friday, outlines information regarding the weekly change in petroleum inventories held and produced by the U.S., both locally and abroad.

The report provides an overview of the level of reserves and their movements, thereby helping investors understand the demand/supply dynamics of petroleum products. It is an indicator of current oil prices and volatility that affect businesses of companies engaged in the oil and refining industry, such as ExxonMobil Corp. (XOM), Chevron Corp. (CVX), ConocoPhillips (COP), Valero Energy Corp. (VLO) and Tesoro Corp. (TSO).

Analysis of the Data

Crude Oil: The federal government’s EIA report revealed that crude inventories rose by 304,000 barrels for the week ending February 3, 2012, after jumping by 4.18 million barrels last week.

Analysts surveyed by Platts, the energy information arm of McGraw-Hill Companies Inc. (MHP), had expected oil stocks to go up some 2.25 million barrels. An increase in domestic field production led to the modest stockpile buildup with the world’s biggest oil consumer.

In particular, crude inventories at the Cushing terminal in Oklahoma – the key delivery hub for U.S. crude futures – grew by 367,000 barrels from last week’s level to 30.49 million barrels. Stocks reached an all-time high of 41.90 million barrels in April last year.

At 339.25 million barrels, current crude supplies are 1.7% below the year-earlier level, but are in the upper limit of the average for this time of the year. The crude supply cover was up from 23.4 days in the previous week to 23.6 days. In the year-ago period, the supply cover was 24.2 days.

Gasoline: Supplies of gasoline increased for the second consecutive week as output edged higher. To make matters worse, domestic gasoline consumption, which rose just 0.3% to 8.0 million barrels a day during the previous week, continues to remain weak.

The 1.63 million barrels-build – more than that of projections – took gasoline stockpiles up to 231.78 million barrels. The existing inventory level of the most widely used petroleum product is 3.8% below the year-earlier levels and is in the upper limit of the average range.

Distillate: Distillate fuel inventories (including diesel and heating oil) were up by 1.17 million barrels last week, contrary to analyst expectations for a 200,000 barrels decrease. The rise in distillate fuel supplies – after two consecutive weeks of decline – could be attributed to plunging demand.

At 146.58 million barrels, distillate supplies are 10.8% below the year-ago level and are in the middle of the average range for this time of the year.

Refinery Rates: Refinery utilization was up 1.0% from the prior week at 82.8%. Analysts were expecting the refinery run rate to stay unchanged at 81.8%.

CONOCOPHILLIPS (COP): Free Stock Analysis Report

CHEVRON CORP (CVX): Free Stock Analysis Report

MCGRAW-HILL COS (MHP): Free Stock Analysis Report

TESORO CORP (TSO): Free Stock Analysis Report

VALERO ENERGY (VLO): Free Stock Analysis Report

EXXON MOBIL CRP (XOM): Free Stock Analysis Report

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