Severe winter weather in January put a spike in U.S. demand for petroleum products.
Data compiled by the American Petroleum Institute peg petroleum products supplied to the market at 18.079 million b/d, up 5.3% from January 1995.
The result was a surge of oil imports and refinery runs. For the first time in decades, refinery utilization was above 90%. It inched up to 90.3% this January.
Demand breakout
Distillate (home heating oil and diesel fuel) deliveries in January increased to 3.696 million b/d, up 10.8% from the year ago level.
API estimated this January's frigid temperatures increased demand for heating oil by 110,000-140,000 b/d from last year's January volume. Diesel fuel demand was up 10,000-30,000 b/d from last year.
Residual (heavy oil) deliveries rose 17% to 978,000 b/d, compared with January last year.
API said electric utilities increased resid use, switching from higher priced natural gas, which was in strong demand by residential and commercial customers. Deliveries of residual fuel to utilities rose to more than 350,000 b/d from 180,000 b/d in January 1995.
Kerosine jet fuel deliveries rose 10% to a record 1.702 million b/d. Commercial and military demand for jet fuel remained nearly constant, but the use of jet fuel as a blending agent with diesel fuel to prevent diesel from crystallizing in subfreezing temperatures also increased demand.
API said gasoline deliveries were up a "surprising" 1.8% from a year earlier, even though drivers contended with poor driving conditions and snowstorms caused factories, schools, and businesses to close. Gasoline deliveries rose to an average 7.285 million b/d from 7.157 million b/d in January a year ago.
Deliveries of other fuels rose 1.6%, mainly because of stronger demand for propane for heating.
Petroleum supply
U.S. crude oil production slipped to an average 6.470 million b/d this January, 2.5% lower than in January 1995. Alaskan production of 1.45 million b/d was down from a year ago, due in part to cold weather that hampered tanker loadings at Valdez.
Combined imports of crude oil and petroleum products were 9.041 million b/d, up 13.7% from January a year ago, the largest increase in more than a year.
Crude oil imports rose 10.1% to 7.159 million b/d, while products were up 29.6% at 1.882 million b/d. Gasoline imports averaged 370,000 b/d, the highest for any month in more than a year. Residual fuel imports jumped to 288,000 b/d, the highest since May 1994.
Total inventories fell 15 million bbl in January and stood at 954,800,000 bbl at the end of the month, down 1.5 % from December 1995. Stocks of gasoline and crude oil rose in January, while distillate, jet kerosine, and residual fuel stocks declined.
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