Another build in crude inventories send prices south.

firestarter · Light Sweet Crude Joined: Mar 19, 2006 Posts: 1181

Inventories up

This is only one quarter of the world's supply picture. Is the rest of the world's inventory also in the historical high range?

Has supply somehow outpaced demand or is there some funny numbering going on here?

strider3700

To be expected. With refineries being down for maintenance and the winter fuel to summer fuel switch over We use less oil. There should have been a draw down in gasoline supplies last week.

Don't worry we'll start sucking those reserves down pretty quick in a month or so.
_________________
shame on us, doomed from the start
god have mercy on our dirty little hearts

Dreamtwister · Fission Joined: Feb 06, 2006 Posts: 2268

It's been over $60 all week, and is hovering around $66 as we speak. I wouldn't exactly call that "heading south".
_________________
The whole of human history is a refutation by experiment of the concept of "moral world order". - Friedrich Nietzsche

Eli

We are still suffering the effects of the refining capacity that has been shut down after Katrina.

The big issue that is showing up again and again is the fact that distillates are being drawn down faster than expected. When distillates are running high price wise it serves to keep oil prices high as well. We are also have increased demand.

More refinery maintenance is scheduled and imports from Europe are no longer enough to keep pace with gasoline demand. So we have an enhanced seasonal shortfall as the refiners switch to new fuel blends and are doing more maintenance.

And this my own question what is the composition of the oil that is growing in the US stockpile?
To me that is absolutely key, to the industry. It is one thing if all this oil build up is light sweet crude and another if it is sour heavy. What we have in stockpile very well could be oil that is much harder to refine. When you get down to it PO is peak light sweet crude.

DantesPeak

With the introduction of new exchange traded commodity investment funds, more and more of those inventories are actually owned by investors. Not only are those investors holding those positions as long term investments, but they will be holding only those oil inventories meeting futures specifications.

So like Eli says, what inventories are left? We already know the SPR is only about 30% or so high quality oil easily refined. Maybe these inventories are not as readily available or as high a quality as generally assumed.

firestarter · Light Sweet Crude Joined: Mar 19, 2006 Posts: 1181

Eli

Ok, yeah

Your are right on. To point at the simple build of US oil stockpile and say "hey look their is no oil supply problem" is complete foolishness and some people are doing that.

That is why I asked the question of what is the quality of oil being built up which no one really knows.

We have hell to pay if it is over 50% heavy crude that stuff is murder on equipment. If that is the oil we have to work with then look for more fires and explosions this summer.

I can't answer whether or not the same thing is going on in other countries, I have heard and seen examples where developing countries are being priced out of the market. But I think India and Chinese demand would take up slack in the market just as soon as the US would.

Dreamtwister · Fission Joined: Feb 06, 2006 Posts: 2268

americandream

Human nature is amazing......here we have crude thresholds steadily going ballistic...and the odd little inflection is seen as a fall down south...............................

I reckon these numbskulls that pathetically pass off as the human race wont even register lifestyle decline.........let alone take measures to alter their habits.

Lol......our leaders are useful patsies for the hypocrites we all are.........I reckon they earn every cent we pay them. I wonder when they're going to really tell us just how spoilt we really are.
_________________
Bugger me, I hear oil's runnin out mate!

Zardoz

firestarter · Light Sweet Crude Joined: Mar 19, 2006 Posts: 1181

smiley · Fission Joined: Apr 16, 2004 Posts: 2144 Location: Europe

hoplite · Heavy Crude Joined: Oct 22, 2004 Posts: 300

70% of us refining capacity is FOR SOUR CRUDE.

Relax, I say AGAIN, PO is not going to be a problem in our lifetimes! (no matter how much you wish it to be so...)

ozkrenske

DantesPeak

"maybe you are already dead" - could be why he is not worried about PO in his lifetime.

Meanwhile if there is an embargo of oil from Iran, we here in the US will be doing a lot of roof repairs with that heavy SPR oil while we are stuck at home.