Summary of Weekly Petroleum Data for the week ending October 18, 2019 with my comments in blue.
U.S. crude oil refinery inputs averaged 15.9 million barrels per day during the week ending October 18, 2019, which was 429,000 barrels per day more than the previous week’s average. Refineries operated at 85.2% of their operable capacity last week. < Refineries are starting to come out of the maintenance period. Look for an increase to over 90% of capacity in early November, which will draw down crude oil inventories.
Gasoline production increased last week, averaging 10.1 million barrels per day.
Distillate fuel production increased last week, averaging 4.8 million barrels per day.
U.S. crude oil imports averaged 5.9 million barrels per day last week, down by 438,000 barrels per day from the previous week. Over the past four weeks, crude oil imports averaged about 6.2 million barrels per day, 19.5% less than the same four-week period last year. Total motor gasoline imports (including both finished gasoline and gasoline blending components) last week averaged 697,000 barrels per day, and distillate fuel imports averaged 133,000 barrels per day. < Dip in imports could be the beginning of impact from attack on Saudi Arabia's export facilities.
> U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) decreased by 1.7 million barrels from the previous week. At 433.2 million barrels, U.S. crude oil inventories are at the five year average for this time of year.
> Total motor gasoline inventories decreased by 3.1 million barrels last week and are about 2% above the five year average for this time of year. Finished gasoline and blending components inventories both decreased last week.
> Distillate fuel inventories decreased by 2.7 million barrels last week and are about 12% below the five year average for this time of year. < This is the primary reason that refiners need to quickly ramp up production. Home heating oil and diesel inventories are dangerously low.
> Propane/propylene inventories decreased by 0.5 million barrels last week and areabout 13% above the five year average for this time of year.
>> Total commercial petroleum inventories decreased last week by 9.0 million barrels last week. < VERY BULLISH.
Total products supplied over the last four-week period averaged 21.1 million barrels per day, up by 3.4% from the same period last year. Over the past four weeks, motor gasoline product supplied averaged 9.4 million barrels per day, up by 2.3% from the same period last year. Distillate fuel product supplied averaged 4.1 million barrels per day over the past four weeks, up by 0.8% from the same period last year. Jet fuel product supplied was up 5.8% compared with the same four-week period last year. < Demand remains high.
EIA - Weekly Petroleum Report - Oct 23
EIA - Weekly Petroleum Report - Oct 23
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: EIA - Weekly Petroleum Report - Oct 23
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: EIA - Weekly Petroleum Report - Oct 23
Cut from Phil Flynn's report prior to the EIA weekly report:
The new International Maritime Organization or IMO 2020 rule will set the new limit for ocean-going vessels to 0.5% by weight, down from 3.5%, which was established in 2012. U.S. supplies, which according to the Energy Information Administration, are already 11% below the five-year average and now looks to fall further this week.
The FT reports, “The change is expected to boost demand instead for cleaner fuels, including marine gas oil, a distillate akin to diesel, and low-Sulphur fuel oil. Traders say this is beginning to affect oil product prices. The market premium for refined oil over crude reflects the notional profit to be gained by refiners of petroleum products. In the case of refining gas oil from Brent crude, it has increased by 19 percent since September 1, to $18.58 a barrel on Tuesday. As the IMO rule was finalized, some analysts warned it could inflate global oil prices, since it incentivizes refineries to search for the best grades of crude for making lower-Sulphur marine fuels. The U.S. government joined several flag states in seeking to phase in the rule’s implementation, without success.”
This is raising serious questions as to why refiners are not ramping up to meet the challenge. So are they hoarding ultra-low diesel in tankers to try to profit on the new rules but then it does not explain why refiners are not ramping up output. So, refiners, I need to hear from you. One theory that I have heard and have bounced off of some of my refining contacts, is that low runs are in part because some refiners are having a hard time ramping up because of the lack of heavier grades of crude. I have heard different responses to the question. So if you have some insight on the issue let me know so we can share. It will be good to know whether the refining issues are more transitory in nature or more systemic.
The new International Maritime Organization or IMO 2020 rule will set the new limit for ocean-going vessels to 0.5% by weight, down from 3.5%, which was established in 2012. U.S. supplies, which according to the Energy Information Administration, are already 11% below the five-year average and now looks to fall further this week.
The FT reports, “The change is expected to boost demand instead for cleaner fuels, including marine gas oil, a distillate akin to diesel, and low-Sulphur fuel oil. Traders say this is beginning to affect oil product prices. The market premium for refined oil over crude reflects the notional profit to be gained by refiners of petroleum products. In the case of refining gas oil from Brent crude, it has increased by 19 percent since September 1, to $18.58 a barrel on Tuesday. As the IMO rule was finalized, some analysts warned it could inflate global oil prices, since it incentivizes refineries to search for the best grades of crude for making lower-Sulphur marine fuels. The U.S. government joined several flag states in seeking to phase in the rule’s implementation, without success.”
This is raising serious questions as to why refiners are not ramping up to meet the challenge. So are they hoarding ultra-low diesel in tankers to try to profit on the new rules but then it does not explain why refiners are not ramping up output. So, refiners, I need to hear from you. One theory that I have heard and have bounced off of some of my refining contacts, is that low runs are in part because some refiners are having a hard time ramping up because of the lack of heavier grades of crude. I have heard different responses to the question. So if you have some insight on the issue let me know so we can share. It will be good to know whether the refining issues are more transitory in nature or more systemic.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group