US inventories of fuel oil fell for the second straight week to a seven-week low in the week ended October 3, drawing down 680,000 barrels to 35.833 million barrels, data released Wednesday by the US Energy Information Administration showed.
The drop brought stocks to their lowest level since hitting 35.486 million barrels in the week ended August 15 and marked the third draw in the past four weeks.
Stocks fell throughout most of the country, but the largest draw came from the Central Atlantic -- a sub-region of the Atlantic Coast including New York, New Jersey, Pennsylvania, Maryland and Delaware -- where inventories fell 626,000 barrels to 5.134 million barrels. The Gulf Coast also saw a major stock draw, falling 411,000 barrels to 21.546 million barrels.
The largest factor in the draw appeared to stem from an increase in implied demand, the EIA's estimate of demand from surrounding factors, which jumped 118,000 b/d to 310,000 b/d. Implied demand averaged only 212,000 b/d over the past 10 weeks, compared with 248,000 b/d over the same stretch last year.
Declining production continued to play a role in falling stocks, as nationwide output dropped 19,000 b/d to 392,000 b/d, its lowest level since hitting 372,000 b/d the week ended August 8. Refinery yields of fuel oil fell 10 points to 2.52%, above recent lows but still below the year-to-date average of 2.78%.
In contrast, total imports of fuel oil rose 75,000 b/d to a one-month high of 205,000 b/d. The Gulf Coast and West Coast accounted for nearly all of these imports at 79,000 b/d and 117,000 b/d, respectively. Atlantic Coast imports fell to a six-month low at only 8,000 b/d. They last reached lower when the region saw no imports the week ended April 11.
