By Catherine Ngai and Liz Hampton

NEW YORK/HOUSTON, Feb 10 (Reuters) - U.S. refiner Phillips 66 dumped crude for immediate delivery in Cushing, Oklahoma on Wednesday, sparking speculation that the move reflected advance warning of looming output cuts amid sluggish winter demand and record inventories.

The unusual sales of excess oil added pressure to the March/April WTI futures spread (CLc1-CLc2), with the front-month discount widening to as much as $2.37 a barrel on Wednesday, the most since November.

It was unclear how many barrels one of the largest U.S. independent refiners sold, but three traders confirmed at least two deals traded at negative $2.50 and $2.75 a barrel. Two sources said a second refiner was also looking to offload barrels but transactions were not confirmed.

A company spokesman said that it does not comment on market rumors or speculation.

These deals drew notice among traders, who said the prices were distressed and the timing unusual.

The so-called cash roll, which allows traders to roll long positions forward, typically trades in the three days following the expiry of the prompt futures contract. The trading period for February-March contracts concluded almost three weeks ago.

Since then, however, oversupply has pressured refined products prices lower, and now some grades of crude are yielding negative cracking margins, traders say.

"Midwest margins turned negative after operating expenses last week and forward cracks suggest margins will remain in the doldrums for some time," said Dominic Haywood, an analyst for Energy Aspects in London.

Planned maintenance in the industry may not be enough to offer any respite, he added.

U.S. Energy Information Administration data on Wednesday showed inventories at the Cushing, Oklahoma delivery hub hit a record 64.7 million barrels last week - just 8 million barrels shy of its theoretical limit - stoking concerns that tanks may overflow in coming weeks.

But Midwest refinery utilization rates fell by 1.8 percentage points to 95.6 percent in the week ended Feb. 5, the EIA reported.

Midwest refiners ran their facilities near full tilt for much of January, averaging more than 96 percent capacity utilization compared with just under 91 percent last year, inundating the region with stocks of gasoline and distillates.

One trader described the market as a "bloodbath."

If Phillips 66 does cut refinery runs, it would be the third refiner to capitulate amid record gasoline inventories and negative margins.

Earlier on Wednesday, sources said Delta Air Lines' Monroe Energy refinery near Philadelphia had decided to cut output by 10 percent at its 185,000 barrels per day (bpd) refinery due to economic reasons.