(Reuters) -U.S. crude oil stockpiles fell for the eighth straight week last week, as renewed vigor in the U.S. economy continues to drive higher fuel demand, the Energy Information Administration said on Wednesday.
Crude inventories fell by 7.9 million barrels in the week to July 9, far more than analysts’ expectations for a decrease of 4.4 million barrels.
Refiners have been drawing down crude inventories in the longest streak since January 2018, in response to heavier demand, while U.S. production has been relatively stagnant.
“U.S. oil inventories have dropped for an eighth consecutive week - with another solid draw at that - falling to their lowest since January 2020 amid ongoing strength in refinery runs and exports,” said Matt Smith, director of commodity research at ClipperData.
Net U.S. crude imports fell last week by 1.1 million barrels per day as exports alone jumped to over 4 million bpd.
Crude production rose to 11.4 million bpd last week to its highest since May 2020, but that figure is considered volatile and less reliable than monthly data.
Refinery crude runs fell by 22,000 bpd and refinery utilization rates fell by 0.4 percentage point.
Fuel stocks rose last week even as refinery runs eased back a bit. Gasoline stocks rose by 1 million barrels, compared with expectations for a 1.8 million-barrel drop.
Distillate stockpiles, which include diesel and heating oil, rose by 3.7 million barrels, versus expectations for a 877,000 barrel-increase.
Overall product supplied, a measure of demand, was 20.6 million bpd over the last four weeks, roughly in line with figures from two years ago, prior to the coronavirus pandemic. Weekly figures showed a sharp decline, however.
“The significant decline in gasoline and diesel demand has pressured prices, even though crude oil inventories have continued to draw,” said Andrew Lipow, president of Lipow Oil Associates in Houston.
Oil benchmarks slipped on the news. U.S. oil dropped by 1.4%, or $1.07, to $74.18 as of 11:44 a.m. EDT (1544 GMT), while Brent lost 70 cents to $75.79 a barrel.
Reporting By New York Energy DeskEditing by Marguerita Choy