The EIA (Energy Information Administration) logged a seventh consecutive US crude draw in its Weekly Petroleum Status Report for the week to 5 June, down 7.2mb to 426.5mb, while refinery utilisation reached a cyclical high of 95.3%.1 The detail that matters for middle-distillate desks is the pairing: maximum throughput on one side, a widening distillate deficit on the other. Distillate stocks slipped to 13% below the five-year average, two percentage points deeper than the 11% print a fortnight earlier, and crude inputs averaged 17.0mbd, up 80kbd on the week.
For readers outside the trading desk, distillate covers diesel, heating oil and gasoil, the heavy middle of the refined barrel that Europe imports from the US Gulf when its own refineries fall short. Running refineries near their physical ceiling and still losing distillate ground means the extra throughput is not closing the gap. That gap is what has held the ICE gasoil crack near $54/bbl since the EU gasoil import collapse to 695kbd.
This is the sixth-into-seventh draw in an unbroken sequence that began in late April, and the screen has read each one as routine. Gasoline stocks managed a token 0.2mb build and sit 6% under the five-year band, so the tightness is concentrated where Europe sources rather than spread across the barrel. An ARA gasoil position now has hard inventory data under the crack floor rather than a sentiment-driven level, and the US arbitrage that would normally cap a European squeeze is tightening, not loosening, at the worst possible point in the runs.
