U.S. crude oil inventories jumped far more than expected for the second straight week, sending oil prices to a weekly low and adding to fears of oversupply. The U.S. Energy Information Administration (EIA) said crude oil inventories increased 6218k in the week ending Jan. 23 compared to the +2800k consensus estimate. It was the second consecutive week where oil inventories significantly overshot expectations. In last week's report, oil inventories increased 6100k. Crude prices fell nearly $2 to a weekly low of $40.60 in the moments following the report but quickly rebounded to $41.58 per barrel. Part of the reason for the bounce was an unexpected draw down in gasoline inventories. Supplies fell 121k compared to expectations of a 1750k increase. Distillate supplies were relatively in line, falling 1005k compared to the expectation for -1125k. Refinery utilization fell 0.79 percentage points, compared to the -0.50 consensus estimate and following a 1.98 percentage point decrease last week. Refineries operated at 82.5% of capacity. Crude oil imports fell by 0.158 million barrels per day to 9.7 mbpd. The EIA figures showed gasoline demand fell slightly last week to 8.8 million barrels per day. They also said demand is 1.7% lower than the same period last year. There continues to be a huge supply overhang, with crude inventories "above the upper limit of the average range for this time of year," according to the EIA. Gasoline inventories are "near the upper limit of the average range," while distillate inventories are "above the upper limit of the average range for this time of year," according to the EIA.

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