U.S. inventories of distillate fuel probably decreased for a third week as cold weather boosted demand for heating oil, a Bloomberg survey showed. Crude stockpiles rose.
Distillate inventories, including diesel and heating oil, declined by 2.5 million barrels, or 2.1 percent, to 118.2 million last week, based on the median of seven analyst estimates before a report tomorrow from the Energy Information Administration. All respondents projected a drop.
The U.S. will get another blast of arctic air this week, the National Weather Service said. About 25 percent of households in the Northeast use heating oil to warm their homes, according to the EIA, the Energy Department’s statistical arm. Crude inventories increased for a second week and gasoline stockpiles also rose, the survey showed.
January is on track to be the coldest month of the century in the lower 48 states, according to Commodity Weather Group LLC. Demand for distillate rose 1.5 percent in the week ended Jan. 17 to 3.78 million barrels a day, the most since Dec. 20, the EIA said last week.
Crude inventories rose 2 million barrels last week, or 0.6 percent, to 353.2 million, the survey showed. All seven respondents saw an increase.
Supplies of gasoline climbed 1.7 million barrels, or 0.7 percent, to 237 million, which would be the highest level since February 2011. All analysts predicted a gain.
The refinery utilization rate increased 1 percentage point to 87.5 percent of capacity in the survey.
Ultra low sulfur diesel, a proxy for heating oil, slid 4.5 cents, or 1.4 percent, to end at $3.0924 a gallon on the New York Mercantile Exchange after reaching the highest level since Aug. 30 in intraday trading.
West Texas Intermediate crude for February delivery fell 92 cents, or 1 percent, to $95.72 a barrel in New York. Gasoline futures for February delivery dropped 4.15 cents, or 1.6 percent, to $2.6217 a gallon.
The EIA is scheduled to release its weekly petroleum report at 10:30 a.m. tomorrow in Washington.
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