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US commercial crude oil inventories rose by 4.4 million barrels in the week ending August 14 to 428.8 million barrels, erasing seasonal deficits to match the five-year average for this time of year as refiners accelerated processing rates. Refining activity expanded towards peak summer operational levels, with crude inputs rising by 215,000 bpd to average 17.40 million bpd, lifting operable capacity utilisation by 1.0 percentage point to a robust 97.2%.

On the trade ledger, crude exports staged a sharp rebound, surging by 1.01 million bpd to 4.07 million bpd, while crude imports fell by 746,000 bpd to average 6.59 million bpd. Domestic crude production held virtually flat at 13.83 million bpd. Concurrently, Strategic Petroleum Reserve (SPR) volumes contracted by another 5.3 million barrels to 293.4 million barrels as official drawdowns persisted.

Downstream product balances showed distinct divergence across the barrel. Total motor gasoline inventories edged up by 0.7 million barrels to 209.4 million barrels—standing 5% below the five-year seasonal average—supported by an uptick in finished gasoline production to 9.71 million bpd. In contrast, distillate fuel oil stocks shed 1.5 million barrels to 105.6 million barrels, widening the deficit to 13% below historical baselines despite refinery output holding at 5.23 million bpd. Meanwhile, propane/propylene inventories expanded by 2.0 million barrels to 107.0 million barrels, hovering 31% above seasonal averages.

The progression of commercial crude stocks back to seasonal parity—counterbalanced by depleted SPR reserves and deepening distillate deficits—highlights an asymmetric domestic balance sheet. With elevated freight premiums and shipping bottlenecks persisting along Middle Eastern transit corridors, the heavy domestic propane overhang continues to suppress Mont Belvieu feedstock pricing, reinforcing structural ethylene margin advantages for US gas-based crackers over higher-cost naphtha producers across Europe and Asia.

Written by: Aiman Haikal