Zacks Analyst Blog Highlights: ExxonMobil, Chevron, ConocoPhillips, Valero and Tesoro

CHICAGO, Feb. 28, 2011 /PRNewswire/ -- Zacks.com Analyst Blog features: ExxonMobil (NYSE: XOM), Chevron Corp. (NYSE: CVX), ConocoPhillips (NYSE: COP), Valero (NYSE: VLO) and Tesoro (NYSE: TSO).

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Here are highlights from Friday's Analyst Blog:

EIA: Crude Stocks Up, Products Down

The U.S. Energy Department's weekly inventory release showed another build-up in crude stockpiles, though less-than-expected. The agency's report further added that fuel inventories fell and refinery run-rates dropped to a 12-month low.

The Energy Information Administration ("EIA") Petroleum Status Report – which contains data for the previous week ending on Friday – outlines information regarding the weekly change in petroleum inventories held and produced by the U.S., both locally and abroad.

The report provides an overview of the level of reserves and their movements, thereby helping investors to understand the demand/supply dynamics of petroleum products. It is an indicator of current oil prices and volatility that affect businesses of companies engaged in oil and refining industry, such as ExxonMobil (NYSE: XOM), Chevron Corp. (NYSE: CVX), ConocoPhillips (NYSE: COP), Valero (NYSE: VLO) and Tesoro (NYSE: TSO).

Crude Oil

The federal government's EIA report revealed that crude inventories rose by 822 thousand barrels for the week ending February 18, 2011, against expectation of a larger gain set by analysts who had been surveyed by Platts.

The increase in oil stocks – the sixth in as many weeks – follows a 6-week trend of steady decline in supplies, which slid by more than 26.5 million barrels during the period, fueled by cold weather conditions and the year-end tax-related inventory adjustments. Curtailed refinery operations led to the stockpile build in the world's biggest oil user, more than nullifying the effects of falling imports.

But despite the continued glut in the domestic oil stocks, crude prices are still trending at around the $100 a barrel level amid concerns that the violence in Libya will boil over to other oil rich nations in the Middle East and lead to a supply shortfall.

At 346.7 million barrels, crude supplies are 2.7% above the year-earlier level and are above the upper limit of the average for this time of the year. The crude supply cover was up from 24.4 days in the previous week to 24.7 days. In the year-ago period, the supply cover was 24.6 days.

Gasoline

Supplies of gasoline fell for the first time in eight weeks, as demand edged up by 291 thousand barrels per day, import levels dropped by 127 thousand barrels per day, and   production decreased by 26 thousand barrels per day.

The 2.8 million barrel drop – against analyst projections for a build – took gasoline stockpiles to 238.3 million barrels, down from a 20-year high reached in the previous week. Current inventory levels are 3.1% higher than year-earlier levels and are above the upper half of the average range.

Distillate

Distillate fuel inventories (including diesel and heating oil) were down by 1.3 million barrels last week, failing to match forecasts for a higher fall. The decrease in distillate fuel supplies can be attributed to a drop in production (by 33 thousand barrels per day) and imports (by 40 thousand barrels per day), partly offset by lower demand.

At 159.9 million barrels, distillate supplies were 4.7% more than the year-ago level and also above the upper boundary of the average range for this time of the year.

Refinery Rates

Refinery utilization was down 1.8% from the prior week to 79.4%. Analysts were expecting the refinery run rate to remain unchanged.

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