Crude Oil Storage Report - June 29
Posted: Wed Jun 29, 2016 10:31 am
The U.S. Energy Information Administration said in its weekly report that crude oil inventories fell by 4.1 million barrels in the week ended June 24. Market analysts' expected a crude-stock decline of 2.4 million barrels, while the American Petroleum Institute late Tuesday reported a supply drop of 3.9 million barrels.
U.S. crude oil inventories have now declined 7 of the last 8 weeks. Draws from inventory are expected though the summer months as refiners need more crude to produce transportation fuels. My estimate is that U.S. crude oil inventories will decline 30 to 40 million barrels during July & August. Demand for refined products ALWAYS spikes in the 3rd quarter and this year IEA is forecasting demand for refined products to increase by 1,270,000 barrels per day from Q2 to Q3. My SWAG is that demand for refined products will increase by more than the IEA estimate as their forecasts have been below actuals for several quarters in a row. In the last big oil price cycle (2008-2010) IEA grossly underestimate the impact of low fuel prices on demand. You can find the IEA report at https://www.iea.org/oilmarketreport/omrpublic/ It also takes more "Black Oil" to produce summer blends of gasoline in the U.S.
Supplies at Cushing, Oklahoma, the key delivery point for Nymex crude, fell by 951,000 barrels last week, the EIA said. Total U.S. crude oil inventories stood at 526.6 million barrels as of last week.
The report also showed that gasoline inventories increased by 1.4 million barrels, compared to expectations for a gain of 58,000 barrels, while distillate stockpiles decrease by 1.8 million barrels.
Oil got a further boost amid concerns over supply disruption in Norway, where about 7,500 workers on seven oil and gas fields could go on strike from Saturday if a new wage deal is not agreed before a Friday deadline. The affected fields account for nearly 18% of Norway's oil output, hitting production from the North Sea's top producer.
U.S. crude oil inventories have now declined 7 of the last 8 weeks. Draws from inventory are expected though the summer months as refiners need more crude to produce transportation fuels. My estimate is that U.S. crude oil inventories will decline 30 to 40 million barrels during July & August. Demand for refined products ALWAYS spikes in the 3rd quarter and this year IEA is forecasting demand for refined products to increase by 1,270,000 barrels per day from Q2 to Q3. My SWAG is that demand for refined products will increase by more than the IEA estimate as their forecasts have been below actuals for several quarters in a row. In the last big oil price cycle (2008-2010) IEA grossly underestimate the impact of low fuel prices on demand. You can find the IEA report at https://www.iea.org/oilmarketreport/omrpublic/ It also takes more "Black Oil" to produce summer blends of gasoline in the U.S.
Supplies at Cushing, Oklahoma, the key delivery point for Nymex crude, fell by 951,000 barrels last week, the EIA said. Total U.S. crude oil inventories stood at 526.6 million barrels as of last week.
The report also showed that gasoline inventories increased by 1.4 million barrels, compared to expectations for a gain of 58,000 barrels, while distillate stockpiles decrease by 1.8 million barrels.
Oil got a further boost amid concerns over supply disruption in Norway, where about 7,500 workers on seven oil and gas fields could go on strike from Saturday if a new wage deal is not agreed before a Friday deadline. The affected fields account for nearly 18% of Norway's oil output, hitting production from the North Sea's top producer.