Tue, 21st November 2017

Anirudh Sethi Report


Archives of “energy information administration” Tag

US oil output to rise 1.3% in 2017, EIA says

US oil production has turned a corner after a long period of weak petroleum prices, the government said, with volumes rising for the first time since early 2015.

The Energy Information Administration forecast that oil output from the US will increase 1.3 per cent to 9m barrels per day in 2017, abandoning an earlier prediction of a 0.9 per cent fall.

In the first forecast for 2018 in its monthly Short-Term Energy Outlook, the statistical agency said US crude production will rise another 3.3 per cent, or 300,000 b/d, to 9.3m b/d. Production hit bottom last September, EIA said.

US EIA weekly oil inventories -2389k vs -1500k exp (PANIC Continues…..)

US EIA weekly oil inventory data report week ending 2 December 2016

  • Prior -884k
  • Cushing 3783k vs 256k exp. Prior 2419k
  • Gasoline 3425k vs 1600k exp. Prior 2097k
  • Distillates 2501k vs 2000k exp. Prior 4957k
  • Refinery utilisation 0.6% vs 1.0% exp. Prior -1.0%
  • Production 8.697m vs 8.699m prior

A bigger draw than expected here but not as unexpected after the ‘Oil report that shall not be named’ also showed a bigger draw. Production was pretty flat. There’s still the whiff of the OPEC deal floating around but once that’s all done and dusted, we’ll likely get back to seeing the market move more in this report.

WTI managed a 50.20/55 range on the news.

US EIA weekly oil inventories -6200K vs +3250K expected

Official weekly crude oil inventories from the US EIA

  • EIA weekly US crude oil inventories vs 3250K expected
  • Gasoline inventories -3204 vs -1400K exp
  • Distillates +2238K vs +200K exp
  • Cushing +526K vs +700K
  • Production +0.2% w/w
  • Production 8.512 mbpd vs 8.493 mbpd prior
  • Production down 6.8% y/y

According to newswires reports, API crude inventories were -7497K, gasoline -2500K, distillates +1400K. So what was ‘expected’ from the consensus was heavily skewed and far closer to those numbers.

Oil hits an intraday high of $45.50, up 55 cents from before the report.

US petrol demand jumps to record high in July

US drivers burned through a record amount of petrol last month, according to industry data, showing the effects of cheap prices and a brightening labour market.
Motor gasoline deliveries totaled 9.668m barrels per day in July, up 2.4 per cent from a year ago and surpassing a high notched in June, the American Petroleum Institute said.

The volumes sold — more than 10 per cent of global oil demand — came as American drivers enjoyed the lowest petrol prices in a dozen years, averaging $2.24 a gallon. July and August are the height of the US summer holiday driving season

The thirst for petrol did little to dent historically high US gasoline stocks that have dragged on oil markets. API said the stocks averaged 237.1m barrels in July, down fractionally from June and 8.7 per cent more than July 2015. In July US refiners upped gasoline output by 1.9 per cent on year to 10.2m b/d, while gasoline imports rose 10.5 per cent to 815,000 b/d, API said.

US petrol inventories at decades high

US petrol inventories sit at the highest level in decades for the start of summer driving season, threatening oil’s rally to $50 a barrel.

More than 237m barrels of petrol was stocked away in tanks on June 17, the US Energy Information Administration reported Wednesday. That was 8.7 per cent more than a year before and the most for June in records dating back to the 1980s.

This state of plenty is evident in New York’s gasoline futures market. In typical years, the contract for July delivery costs more than August. But after Wednesday’s report July gasoline was trading unchanged at $1.5929 per gallon, about a penny less than the August contract. This discount incentivises storing petrol rather than selling it to convenience stores.

Petrol stocks remain inflated even though US drivers are shattering consumption records. In the week to June 17, the EIA estimated petrol demand at an all-time high 9.815m barrels per day, surpassing a previous peak set in 2007.

A strengthening jobs market and cheap petrol prices have induced motorists to take to the roads for work and pleasure, while sales of fuel-efficient vehicles have slowed.

Overnight US Market :Dow closed up 49 points

U.S. stocks ended slightly higher after wavering on news that OPEC failed to seal a deal on oil production.

Markets also reacted to the European Central Bankleaving interest rates at current levels and private employers in the U.S. creating slightly more jobs than expected in May.

The Dow Jones industrial average ended up 49 points, or 0.3%. The broader Standard & Poor’s 500 stock index also gained 0.3%, while the Nasdaq composite climbed 0.4%.

All three indexes started the day in negative territory and passed above the break-even point around two hours before the 4 p.m. ET closing bell.

Most of the news investors watched came in as expected, offering little, if any, surprise factor to markets. The ECB was expected to stand pat and the 173,000 jobs created last month by private employers, according to payroll processor ADP, were basically right in line with the 170,000 estimate.

Wall Street also digested news that the Organization of Petroleum Exporting Countries (OPEC) could not strike a deal on capping or freezing daily oil production. The OPEC news, while not totally unexpected, initially hit oil prices as a lack of a supply cut or cap does little to help end the global oil glut. But oil pared its losses after the U.S. Energy Information Administration reported that U.S. crude oil inventories fell by 1.4 million barrels in the week ending May 27.

U.S.-produced crude was up 0.4% to $49.20 a barrel after being down as low as $47.97 earlier. Last week crude prices topped $50 per barrel for the first time since October.

Next up for Wall Street is the all-important May jobs report set for release Friday at 8:30 a.m. ET. Analysts are looking for 160,000 new jobs in May. The jobs report, of course, has key implications for the Federal Reserve, which has hinted to financial markets that the first quarter-point rate hike of 2016 is likely in coming months if data on jobs and the economy keep rolling in steady.

Oil Output Limits Not Brought Up at Preparatory Talks Ahead of OPEC Meeting

oil oil well fireRepresentatives of OPEC member-states agreed during the preparatory meeting in Vienna that supply and demand would start rebalancing in the second half of the year, the sources said.

Oil prices have plunged more than 60 percent from their peak of over $110 a barrel in June 2014 because of global oil production outpacing global demand. Since the 12-year low registered in January, oil prices have rebounded more than 75 percent.

In April, OPEC and major non-OPEC oil producers failed to agree on freezing oil output at January levels to shore up prices after Saudi Arabia backed out of the deal, insisting that Iran, which has been boosting oil production after years of international sanctions, should be part of any production cuts.

US Energy Information Administration (EIA) administrator Adam Sieminski told Sputnik earlier this month that oil prices would reach some $50 by the end of the current year.

Lawlessness Limits Oil Supply Glut Despite Failure of Doha Talks

Outages at oil production facilities in Africa and South America amid political instability have lessened the impact of the current oil supply glut, analysts told Bloomberg.

Talks between 17 OPEC and non-OPEC petroleum producers aimed at agreeing upon a production freeze collapsed on April 17 after Saudi Arabia reportedly demanded that producers who were absent from the meeting, such as Iran, participate in the deal.

Despite the meeting’s failure, the current daily 1.5 million barrel crude oil surplus is being curbed by outages in oil-producing countries such as Nigeria, Colombia, Libya and Iraq.

“The fact of the matter is that the oversupply in the market is very narrow,” Ed Morse, head of commodities research at Citigroup, told Bloomberg. 

“The world has become highly prone to disruptions of supply in vulnerable petro states.”

In Colombia, attacks by guerrilla rebels have disrupted supplies, and the country’s daily crude exports declined to about 622,000 barrels in March, down 14 percent from a month earlier.

Oil – American Petroleum Institute (API) data – Inventory DRAW of 1.1mln barrels.Crude zooms above $44.50

American Petroleum Institute (API) crude oil inventory data

  • Crude inventories -1.07mln barrels
  • Cushing build 1.9mln barrels
  • Gasoline -400k
  • Distillates -1m

Note –
  • This data is out earlier to API subscribers (at 4.30pm ET) and released publicly at 4.35pm ET.
  • The API data is closely watched as a guide to the U.S. Energy Information
    Administration (EIA) data due tomorrow morning (US time)

Oil – American Petroleum Institute (API) data: Build of 6.2mln barrels

Stockpile data for oil via API’s weekly survey

  • Crude build of 6.223 mln barrels
  • Cushing draw of 1.93 million barrels
  • Gasoline draw 1.58mln barrels
  • Distillate draw 530K bbls
The crude stockpile build was well above expectations (they were around 1.9 mln)-

Note – The American Petroleum Institute data is out earlier to their subscribers (at 4.30pm ET) and released publicly at 4.35pm ET.

  • The API data is closely watched as a guide to the official EIA inventory data due tomorrow morning (US time).
  • The ‘expected’ for the data from EIA today’s is a stock build of 733.33Kbbls for US Crude Oil Inventories.