Energy Prospectus

The U.S. Energy Information Administration said in its weekly report that crude oil inventories declined by 4.6 million barrels in the week ended March 30.

That compared with analysts' expectations for a gain of around 1.4 million barrels, while the American Petroleum Institute late Tuesday reported a supply-drop of 3.3 million barrels.

Supplies at Cushing, Oklahoma, the key delivery point for Nymex crude, rose by 3.6 million barrels last week, the EIA said.

Total U.S. crude oil inventories stood at 425.3 million barrels as of last week, which the EIA considered to be in the lower half of the average range for this time of year.

Domestic oil production - driven by shale extraction - rose about 0.3% to a fresh all-time high of 10.46 million barrels per day, keeping it above Saudi Arabia's output levels and within reach of Russia, the world's biggest crude producer.

The report also showed that gasoline inventories decreased by 1.1 million barrels, compared to expectations for a decline of 1.2 million barrels.
For distillate inventories including diesel, the EIA reported a gain of 0.5 million barrels.
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Comments below are from Raymond James Energy Sector Team based in Houston:

This week's petroleum inventories update was bullish relative to consensus.
''Big Three'' petroleum inventories (crude, gasoline, distillates) fell by 5.2 MMBbls, versus consensus estimates for a draw of 0.8 MMBbls. Commercial crude inventories fell by 4.6 MMBbls, versus consensus calling for a build of 2.0 MMBbls (there were virtually no changes to the SPR this week). Cushing crude inventories rose by 3.7 MMBbls, with Gulf Coast inventories down 6.9 MMBbls. Gasoline posted a draw of 1.1 MMBbls versus consensus calling for a draw of 1.5 MMBbls, while the distillate build of 0.5 MMBbls compared to consensus calling for a draw of 1.3 MMBbls.

As always, regardless of their week-to-week movements, U.S. inventories do not constitute a holistic picture of global (or even total OECD) inventories, but they represent the only ''real-time'' data source.

Refinery utilization ticked up to 93.0% from 92.3% last week.

Total petroleum imports were 10.6 MMBbls per day, up from last week's 10.3 MMBbls per day.

Total petroleum product demand increased 1.4% after last week's 1.2% increase. On a four-week moving average basis, there is a 7.0% y/y increase in total demand.

Lower 48 production is estimated at 9.942 MMBbls per day, up 0.025 MMBbls per day from last week, and 1.276 MMBbls per day above year-ago levels.

Reuters reported that OPEC’s production in the first three months of 2018 has fallen by 425,000 barrels per day (bpd) from its 2017 average.

Reuters reported that supply from all 14 OPEC countries in the first three months of 2018 averaged 32.27 million bpd, tanker-tracking firm Petro-Logistics (SI:HNYG) said in an email, down 425,000 bpd from OPEC’s average daily supply for 2017. “OPEC-14 supply in the first quarter of 2018 declined to the lowest quarterly level since the production curtailment agreement came into effect some fifteen months ago,”

Digging into the details of the EIA weekly report. This should be drawing more attention:

Days of Supply for all critical liquids are way below where they should be.

Crude Oil: 25.4 days of supply, down 1.3 days since 3/3/2018

Gasoline: 25.5 days of supply, down 2.2 days since 3/3/2018

Jet Fuel: 22.8 days of supply, down 2.3 days since 3/3/2018

Distillate Fuel: 32.3 days of supply, down 1.7 days since 3/3/2018

Propane/Propylene: 26.5 days of supply, down 1.5 days since 3/3/2018

In a more "Normal World", stats like this would be drawing a lot more attention and love for the upstream companies. The United States economy runs on this stuff and supplies are getting dangerously low.

The EIA keeps reporting that U.S. crude oil production goes up month after month. It may be, but the monthly data tells a somewhat different story.

We only have "actual" production data (based on state reports and the Feds for GOM) thru January.

United States Oil Production by Month, bbls per day rounded to nearest 1,000:
Sept: 9,470,000
Oct : 9,654,000
Nov: 10,038,000
Dec : 9,958,000
Jan : 9,964,000

Weather does have an impact on production, but we don't really know what production was for February and March. Why is U.S. crude oil in storage below the 5-year average when EIA says production has increased 500,000 barrels per day from January to the week ending March 30th?
> Imports down?
> Exports up?
> Refiners ramping up to meet rising demand?
> All of the above?

Investing.com - Crude oil prices settled lower Wednesday but recovered most of their losses as risk-off sentiment was offset somewhat by an upbeat weekly report showing a huge draw in U.S. crude supplies. (The technical all went green after the markets closed and WTI is up slightly in after hours trading. - Dan)

On the New York Mercantile Exchange crude futures for May delivery fell 14 cents to settle at $63.37 a barrel, while on London's Intercontinental Exchange, Brent lost 14 cents to trade at $67.98 a barrel.

Inventories of U.S. crude fell by 4.617 million barrels for the week ended March 30, confounding expectations for a rise of 1.4 million barrels, according to data from the Energy Information Agency (EIA).

The massive draw in crude stockpiles was supported by increased refinery activity – which tends to raise demand for crude, reducing supplies – as EIA data showed refinery activity rose by 0.07%.

A jump U.S. crude exports to a record also helped cut domestic crude stockpiles. Yet, that was offset by a continued increase in U.S. output, climbing for a sixth straight week to 10.46 million barrels a day, according to data from the Energy Information Administration.

Gasoline inventories – one of the products that crude is refined into – fell by 1.116 million barrels, missing expectations for a decline of 1.264 million barrels, while supplies of distillate – the class of fuels that includes diesel and heating oil – fell by 537,000 barrels, missing expectations for a decline of 1.134 million barrels.

Distillate has made robust start to the year, buoyed by an uptick in distillate demand to its highest since 1979. < Distillates includes heating oil and diesel

“For the first time since 1979, distillate demand during the month of January reached 4.394 million barrels, up about 16% year-on-year and 9% higher than the seasonal 5-year average,” Jefferies said in a report Tuesday, citing data from the Energy Information Administration (EIA).

The upbeat weekly inventory report supported a rebound in crude prices from a session low of $62.08 a barrel as traders remained cautious on risker assets in the wake of recently announced U.S. and China tariffs. At 4:10 PM ET WTI is sitting at $63.53/bbl.

Just FWIW the time stamps on these posts are off by about two hours.