Wholesale Inventories Rise Less Than Sales, Crude Inventories Fall

- Wholesale Inventories rose .8% in April versus estimates of a .4% increase and an upwardly revised .6% gain in March.
- Summary of Weekly Petroleum Data for the Week Ending June 3, 2005.
- The EIA reported crude inventories fell 3.09M barrels versus estimates of a 250K barrel rise. Gasoline inventories fell 31K barrels versus estimates of a 1.1M barrel gain. Distillate inventories rose 1.29M barrels versus estimates of a 1.28M barrel rise.

BOTTOM LINE: Stockpiles at US wholesalers rose more than forecast in April, led by machinery and other business equipment, however sales increased by the most in a year. The inventory-to-sales ratio declined to 1.18 months from 1.19 months in March, the lowest since January, which suggests factories may not need to continue trimming production.

Oil is rising $1.30 on the inventory news. While the drawdown in crude is unwelcome, inventories are still well above average levels for this time of year. The main focus of traders recently has been distillates, which saw a build.