In the latest Petroleum Supply Monthly, US oil demand for May was revised marginally lower by 66 thousand b/d to 18.551 mb/d, and is now lower y/y by 0.156 mb/d (0.8%). This is slightly below our expectations of broadly flat growth, with the bulk of the downward revision coming from fuel oil, revised lower by 0.17 mb/d to 0.215 mb/d. As a result, fuel oil demand is now lower y/y in May by 79 thousand b/d (26.9%), compared to the unlikely growth shown in the weekly data. Distillate demand was also revised lower, the first downward revision in five months, by 65 thousand b/d to 3.772 mb/d, despite this, it remains higher y/y by 27 thousand b/d (0.7%). Jet fuel and ‘other oils' were also revised downwards, by 59 thousand b/d and 47 thousand b/d respectively, taking the corresponding y/y comparisons to growth of 7 thousand b/d and a decline of 98 thousand b/d. Gasoline was the only part of the barrel to revised higher, but by a substantial 0.277 mb/d, and for the third straight month. As a result, yet again, gasoline demand was broadly flat y/y at 8.983 mb/d, the highest levels since August 2012. This trend is likely to persist in June too, with gasoline revised higher and distillates lower.
US crude oil imports were revised higher marginally for the second straight month, by 30 thousand b/d to 7.737 mb/d, as refineries ramped up runs to 15.3 mb/d, the highest since July 2012, higher m/m by 0.435 mb/d and y/y by 0.686 mb/d. Nonetheless, crude imports were still down y/y by 1.171 mb/d, with imports into the Gulf Coast down y/y by nearly 0.9 mb/d to 3.874 mb/d, despite being up m/m. Imports into the East Coast picked up, both m/m and y/y for the second time running, to 0.871 mb/d, with imports of light crudes above 0.4 mb/d for the first time since September 2011 and the highest since June 2011, up y/y by 0.114 mb/d. Light crude grades into PADD 3 also picked up m/m to 0.304 mb/d, with y/y declines easing to 0.379 mb/d. Imports from Nigeria picked up to 0.345 mb/d. Overall imports of light crudes stayed above 1 mb/d for two straight months, with quality issues around tight oils being too light supporting higher volumes of light crude imports we believe. Even total US crude imports have stabilised at around 7.6 mb/d since December last year. Crude exports, meanwhile, eased slightly from the record highs of last month, to 0.125 mb/d, all to Canada. Finished oil product imports were revised higher again to 2.315 mb/d, while oil product exports were revised down for the fourth straight month, by 66 thousand b/d to 2.664 mb/d. This was led by gasoline (lower by 0.1 mb/d), while propane exports were at a record high of 0.308 mb/d, up y/y by 0.163 mb/d.
US inventories were revised higher by 4.5 mb, the majority of revisions were again made in product stocks, revised higher by 3.9 mb. Gasoline stocks were revised up by 2.5 mb, while distillate stocks were lowered by 0.9 mb. Crude stocks were revised slightly higher, by 0.6 mb.