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The energy sector (NYSEARCA:XLE) rises to the top of Wednesday's S&P leaderboard, with U.S. prices regaining the $80/bbl level after domestic crude oil stockpiles rose less than expected during the past week, outweighing continued strength in the U.S. dollar.
Gasoline and distillate inventories fell by 2.4M and 2.9M barrels, respectively, as refining activity declined following several outages.
Also, Hurricane Ian forced temporary production cuts in the Gulf of Mexico, although the impact likely will be short-lived.
Front-month Nymex crude oil for November delivery (CL1:COM) +4.2% at $81.83/bbl, and November Brent crude (CO1:COM) +3.3% at $89.19/bbl.
ETFs: (XLE), (XOP), (CRAK), (DRIP), (GUSH), (NYSEARCA:USO), (UCO), (BNO), (SCO), (USL), (DBO), (USOI), (NRGU)
Among noteworthy gainers, (HES) +4.9%, (MPC) +4.7%, (APA) +4.6%, (VLO) +4.6%, (EOG) +4.4%, (DVN) +3.9%, (PSX) +3.9%.
The sector also enjoys strong leadership from top components (XOM) +2.3%, (CVX) +2.3% and (COP) +3.4%.
Industry analysts forecast U.S. oil refinery utilization rates could top 90% in Q4 for the third straight quarter, reflecting reduced stocks and strong demand for diesel.
Utilization rates typically fall in Q4 as refiners begin winter maintenance and motor fuel consumption declines after the summer driving season ends, but this year's Q4 could see operators hold production rates high to grab strong diesel margins.
OPEC+ meets next week, and Russia reportedly may propose a ~1M bbl/day production cut.