As a result of refiners switching to middle distillate production in recent months due to the impacts of the coronavirus pandemic,the market has been in an oversupply with stocks of"distillate fuel oil"(as reported by the EIA) reaching a year-to-date high of 179MM bbl in the week ending July 31.While volumes have eased,stocks do remain elevated.The glut has caused stocks in the US PADD 1 and 3 regions to grow significandy from the first week of the year by 42.3% to 61MM bbl and by 14.6% to 51MM bbl,respectively,as of Oct.23.While PADD 3 stocks have fallen more sharply from the start of the month by 14.3% compared to PADD 1,where inventories declined by 2.9% over the same period,the region is under more pressure in comparison due to less working storage-63MM bbl in PADD 3 compared to 79MM bbl in PADD 1.
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