The US Energy Information Administration reported US commercial crude oil stockpiles increased by 4.1M barrels to 452.7M barrels (4% above the five-year average) for the week ending January 27th. Crude oil refinery inputs averaged 15.0M barrels per day, a decrease of 19K bpd as compared to the previous week’s average. Gasoline inventories increased by 2.6M barrels (7% below the five-year average), as compared to the 1.8M barrels increase the previous week. Gasoline inventories are currently at a ten-year low. Distillate inventories increased by 2.3M barrels (17% below the five-year average). Total commercial petroleum inventories increased by 1.6M barrels. Refineries operated at 85.7% of their operable capacity. Gasoline production increased averaging 9.4M bpd, as compared to 8.8M bpd the previous week. Distillate fuel production increased averaging 4.7M bpd. Crude oil imports came in at 7.3M bpd, an increase of 1.4M bpd as compared to the previous week. Crude oil imports averaged 6.6M bpd over the last four weeks, 1.0% more than the same period last year. Total motor gasoline imports (including both finished gasoline and gasoline blending components) averaged 501K bpd, and distillate fuel imports averaged 313K bpd.

The Federal Open Market Committee (FOMC) announced the raising of its benchmark federal funds rate by 25 basis points, putting it in the range of between 4.50% and 4.75% — the highest level since October 2007. The move marked the eighth increase since March 2022 and follows a 50 basis point increase in December and four consecutive FOMC meetings ending with a 75 basis point climb. The FOMC statement acknowledged that “Inflation has eased somewhat but remains elevated”. The FOMC statement continued to mirror previous releases stating “The Committee anticipates that ongoing increases in the target range will be appropriate in order to attain a stance of monetary policy that is sufficiently restrictive to return inflation to 2 percent over time”. The FOMC did not release any new economic forecasts.

The U.S. Bureau of Labor Statistics reported a higher-than-expected 517,000 jobs were added as the unemployment rate fell to 3.4% in January, the lowest level in 53 years. November and December’s readings were revised up for a combined (+71K) additional jobs. The number of unemployed workers remained steady at 5.7 million. Seasonal adjustments likely contributed to the strong reading, as weak holiday season hiring may have resulted in fewer-than-normal layoffs in January. Job growth was broad-based with leisure and hospitality adding (+128K) jobs, followed by professional and business services (+82K), government (+74K), health care (+58K), retail (+30K), construction (+25K), and manufacturing (+19K). There were 11 million job openings in December – about 1.9 job openings for each person looking for a job. The labor force participation rate increased slightly to 62.4% from 62.3%, leaving it still below the pre-pandemic level of 63.4%. Average hourly earnings increased by 0.3% in January. At $33.03 average hourly earnings are up 4.4% from a year ago.