Crude oil prices rose on Thursday after the US Energy Department reported a ninth consecutive weekly drawdown of crude stocks, although a surprise build in gasoline supplies helped to cap the gains.
US West Texas Intermediate crude for September delivery, the new front month contract from Thursday, was up 18 cents at $45.93 a barrel at 0042 GMT. The August contract expired on Wednesday after rising 29 cents, or 0.7 per cent, to settle at $44.94 a barrel.
Brent crude's front-month contract was up 22 cents at $47.39 a barrel. The contract for September delivery had gained 51 cents, or 1.1 per cent, to $47.17 the previous day.
“Many market participants had expected far larger crude stock draws during peak runs season in the United States. Clearly these expectations have not been met,” Energy Aspects said in a note.
US crude inventories fell 2.3 million barrels in the week ending July 15, data from the US Energy Information Administration showed.
But at 519.5 million barrels, inventories are at historically high levels for this time of year, the EIA said.
Gasoline stocks
Gasoline stocks rose 911,000 barrels, against a forecast for remaining unchanged, and are well above the upper limit of the average range, the EIA said.
July is considered the peak of a summer when Americans were expected to take to the road and put in record miles with prices relatively low.
Stocks of the motor fuel rose in spite of gasoline output slipping by 168,000 barrels per day even as refinery crude runs rose 319,000 bpd as utilisation rates edged up 0.9 percentage points to 93.2 per cent of total capacity, the EIA data showed.
A glut of refined products has worsened the already-grim outlook for US crude oil for the rest of the year and the first half of 2017, traders warned this week, as the spread between near-term and future delivery prices reached its widest in five months.
So too with Brent crude, a products glut is threatening to spill back into oil prices, BMI Research said in a note.
“An abundance of fuels threatens to dampen crude demand,” it said. “The three North Asian powerhouses are also showing signs that their domestic fuels markets are oversupplied,” BMI said, referring to South Korea, China and Japan.
Combined gasoline exports from the three countries have risen a combined 35 percent in the first five months of 2016 over a year earlier, it said