Like the illusion of Wall Street, with its vast and powerful investment banks, now shuttered, China too is an illusion perpetuated by the Globalists that gave us the 15,000 mile Caesar salad, poisoned cat food and lead based paint on babies' pacifiers. Like the illusion that money would come from thin air to always push housing prices higher, China has spent a generation pursuing its illusion. Pursuing an unattainable dream to be like the West, while 6000 years of its carefully shepherded top soil blows into the sea.
Joined: Oct 23, 2004 Posts: 5928 Location: New Jersey
Posted: Mon Aug 25, 2008 4:23 pm Post subject: Re: Weekly US Petroleum and NG Supply Reports (Current)
pup55 wrote:
To embellish that last point a little more, last fall, we imported .267 mbpd on average between Labor Day and New Years. For the last nine weeks, we have averaged .141.
During that same period, last year we averaged 4.203 mbpd distillate production, at 88% utilization.
That level of production and imports kept the inventories more or less level, given the demand level of last year.
The average distillate demand this summer (from June till now) is 4.158 mbpd. This compares to 4.132 for the same period last year.
We know the farmers are going to need a lot of diesel this year.
Just saying.
I agree that we have a bit of a problem with distillate supplies, and the latest reports continue to suggest demand for diesel in the Midwest farm belt is very strong. But the problem for distillates is even worse when you consider exports:
Distillate exports appear to rising exponentially. Export demand from Argentina, Panama, Mexico, and especially Chile has been extremely strong in 2008. Since early summer, some diesel is now also being shipped to Europe. _________________ It's already over, now it's just a matter of adjusting.
and in 2003, at the end of spring, right at the time of the Gulf war, there were widespread calls to tap into the SPR, because of the catastrophic heating oil price of $1.53
There is currently a dangerous shortage of petroleum distillate in the region. The combination of distillate shortage in the region, low oil inventories throughout the nation and prolonged cold weather significantly raises the probability for severe price spikes in the coming weeks unless the Administration takes action immediately.
With a current inventory of about 133, any kind of hard winter, at these operating levels could quite easily get the system down to less than 100, per the calculation above. In fact, the inventory as of September 2002 was 135 million barrels.
So this is a situation we will have to keep an eye on. No telling what will happen.
Posted: Tue Aug 26, 2008 6:00 pm Post subject: Re: Weekly US Petroleum and NG Supply Reports (Current)
Quote:
Analysts polled by Reuters forecast weekly U.S. inventory data due to be released on Wednesday will show a 1 million barrel build in crude stocks, a 500,000 barrel build in distillate stocks, and a 2.9 million barrel draw in gasoline inventories
Traders' focus is likely to shift to weekly EIA oil inventory data due at 10:35 a.m. EDT Wednesday. Analysts surveyed by Dow Jones Newswires on average predict crude stockpiles rose by 1.0 million barrels the week ended Aug. 22, while gasoline stockpiles fell 2.5 million barrels and stocks of distillates, which include heating oil and diesel, rose by 600,000 barrels. The rate of refinery use is seen rising 0.1 percentage point to 85.8% of capacity.
Joined: Oct 23, 2004 Posts: 5928 Location: New Jersey
Posted: Tue Aug 26, 2008 6:09 pm Post subject: Re: Weekly US Petroleum and NG Supply Reports (Current)
It's amazing how close these predictions are as compared to those of some guy on the internet, since these include a couple of assumptions made about imports and demand that I don't hear any conventional energy analysts talking about.
Quote:
Prediction
Predicted Change -2.8
Quote:
2.9 million barrel draw in gasoline inventories
Quote:
gasoline stockpiles fell 2.5 million barrels
_________________ It's already over, now it's just a matter of adjusting.
Joined: Apr 06, 2006 Posts: 3626 Location: 3 miles NW of Champoeg, Republic of Cascadia
Posted: Tue Aug 26, 2008 9:21 pm Post subject: Re: Weekly US Petroleum and NG Supply Reports (Current)
This is odd:
Finished gasoline in inventory decreases over time while the amount of blending components has taken off since 2004, currently reaching rough parity (101856 mb vs. 105580 mb). The NPC gives a MOL for gasoline of 185 mb, here are their remarks:
Quote:
While inventories continue to fluctuate seasonally,
the average level has remained flat since the last
study. In addition, the low inventory level reached
during the mid-1998 to 2004 time period was no
lower than the minimum reached during the previous
study’s time period (1992 to mid-1998). Since
the last study, inventories approached the LOI only
once, reaching 188 million barrels at the end of
October 2000. This was essentially the same as the
prior minimum level observed in August 1997.
As discussed in the 1998 study, oxygenates are an
important part of the U.S. motor gasoline supply
system and should be considered when evaluating
the capability of the supply system to respond to
market forces. Since the 1998 study, the role of oxygenates
has become more complex with MTBE bans
in several states and the continued oxygenate
requirement in reformulated gasoline. As a result,
ethanol markets have expanded beyond the Midwest
and ethanol is now used for gasoline production in
both the Northeast and California. The transportation
and inventory management systems for ethanol
are largely out of the control of petroleum industry
companies and the ethanol industry’s capability to
meet demand is beyond the scope of this study.
As my chart displays, the trend NPC were remarking on has proceeded unabated since their paper was published. I assume this is considered a healthy state of affairs...with Mexico's continuing production decline they'll be attempting to import more and more finished product, while we have less and less on hand for them from the looks of things. And more and more ethanol in the distribution system will lead to increased corrosion of pipe, among other problems. Maybe it's all a half-baked make work project... _________________ Cogito, ergo non satis bibivi
C'mon man, who're you gonna believe?
Posted: Wed Aug 27, 2008 1:32 am Post subject: Re: Weekly US Petroleum and NG Supply Reports (Current)
Quote:
The transportation
and inventory management systems for ethanol
are largely out of the control of petroleum industry
companies and the ethanol industry’s capability to
meet demand is beyond the scope of this study.
Quote:
Maybe it's all a half-baked make work project...
It's probably a poor man's way of expanding the finished products production capability without making the investment in the actual refiners.
I actually wrote the EIA at one point for some more detail on exactly what these "blending components" are, and more specifically, how complicated it is to turn them into "burnable gasoline" and their answer was basically that they do not know, they do not keep track of some of the oxygenates they blend with, but that they assume that most of the inventory of "blending components" on hand is pretty close to the finished product.
There was some talk last winter about a potential shortage of "alkylate", which is one of these components, but I have not heard for awhile how that ever came out.
But, you are right, The Dude, there are a lot of potential issues with this system that could have a big effect on the MOL, and no one really knows all of the ramifications.
Posted: Wed Aug 27, 2008 5:11 am Post subject: Re: Weekly US Petroleum and NG Supply Reports (Current)
Quote:
The Energy Department is scheduled to release its weekly report tomorrow at 10:35 a.m. in Washington. 196.6 million barrels the week before, Bloomberg's survey showed.
Posted: Wed Aug 27, 2008 6:32 am Post subject: Re: Weekly US Petroleum and NG Supply Reports (Current)
Code:
Analysts 07 Analysts 08 PO.com 08 Reality 08
Mean 0.20 -0.15 -0.07 -0.34
Std Dev 1.13 1.55 2.60 3.30
Max 2 2.5 4.2 5.3
Min -2.1 -3 -4.3 -6.4
N><2 2 9 20 20
Quote:
It's amazing how close these predictions are as compared to those of some guy on the internet
I've checked into this a little bit, while bored in the office waiting for 10:35.
It used to be really unusual for the "panel of analysts" to predict a change of greater than 2.0 million barrels for unleaded, either positive or negative. In 2007, it only occurred twice.
This year, the analysts have predicted a greater or less than 2.0 million barrel change 9 times. In reality, there have been changes of this size or greater 20 times thus far this year.
The method of polling a group of analysts to come up with "analyst expectations" will presumably average out all of the extreme forecasts by individual analysts, sort of a "damping effect".
If you compare the forecasts of the analysts panel vs. mine, you can see that mine are much more variable. If I am way out of whack, there are no 15 other analysts to average out my values.
But, I am also ready to say that something has happened in the last year, that has tended to make the analyst predictions more variable, and therefore closer to the actual fluctuation in this inventory that is found in the real world.
If you run the statistics, average deviation from reality, the difference between them and me is not statistically significant. I have, however, been closer to reality than the analysts on unleaded 20 out of the 33 weeks thus far this year, which shouldn't happen randomly. (p.s. I have not done as well on crude oil, of course, as we all know).
So, maybe more of them are taking the time to calculate out this stuff like I do, compared to before. I suppose it is possible that some of them started doing their "calculation" the easy way..... by waiting until I post, deducting or adding a tenth or two here or there... and going with that.... but I trust that if that is the case, they are donating generously to the PO.com "new server" fund to keep the love going for another year.
Joined: Sep 16, 2004 Posts: 4933 Location: Southwest WI
Posted: Wed Aug 27, 2008 8:45 am Post subject: Re: Weekly US Petroleum and NG Supply Reports (Current)
Quote:
Summary of Weekly Petroleum Data for the Week Ending August 22, 2008
U.S. crude oil refinery inputs averaged 15.1 million barrels per day during the
week ending August 22, up 300 thousand barrels per day from the previous week's
average. Refineries operated at 87.3 percent of their operable capacity last
week. Gasoline production rose last week, averaging about 9.2 million barrels
per day. Distillate fuel production decreased last week, averaging nearly 4.4
million barrels per day.
U.S. crude oil imports averaged nearly 10.0 million barrels per day last week,
down 1.0 million barrels per day from the previous week. Over the last four
weeks, crude oil imports have averaged 10.2 million barrels per day, 17
thousand barrels per day below the same four-week period last year. Total motor
gasoline imports including both finished gasoline and gasoline blending
components) last week averaged about 1.4 million barrels per day. Distillate
fuel imports averaged 123 thousand barrels per day last week.
U.S. commercial crude oil inventories (excluding those in the Strategic
Petroleum Reserve) decreased by 0.1 million barrels from the previous week. At
305.8 million barrels, U.S. crude oil inventories are in the middle of the
average range for this time of year. Total motor gasoline inventories decreased
by 1.2 million barrels last week, and are below the lower boundary of the
average range. Both finished gasoline inventories and gasoline blending
components inventories decreased last week. Distillate fuel inventories remained
unchanged, and are in the upper half of the average range for this time of year.
Propane/propylene inventories increased by 1.2 million barrels last week but
remain below the lower limit of the average range. Total commercial petroleum
inventories increased by 2.3 million barrels last week, and are in the lower
half of the average range for this time of year.
Total products supplied over the last four-week period has averaged 20.2 million
barrels per day, down by 3.6 percent compared to the similar period last year.
Over the last four weeks, motor gasoline demand has averaged 9.4 million barrels
per day, down by 1.6 percent from the same period last year. Distillate fuel
demand has averaged 4.2 million barrels per day over the last four weeks, up by
2.2 percent from the same period last year. Jet fuel demand is 6.9 percent lower
over the last four weeks compared to the same four-week period last year.
Down a little.... Looks like imports were really high... _________________ Clothing should be optional.
Posted: Wed Aug 27, 2008 8:51 am Post subject: Re: Weekly US Petroleum and NG Supply Reports (Current)
How much of the gasoline inventory was gasoline components--how much was finished product? Talk about opaque. _________________ Civilization: the biosphere's skin disease
Joined: Oct 23, 2004 Posts: 5928 Location: New Jersey
Posted: Wed Aug 27, 2008 10:10 am Post subject: Re: Weekly US Petroleum and NG Supply Reports (Current)
Gasoline imports were significantly higher than I expected, and although much better than in recent weeks, the level of imports would have been considered just average for this season a year ago. Possibly those in the industry were caught off guard by the rapid plunge in gasoline inventories a few weeks back, and decided to get a little more aggressive about securing supplies.
Finished gasoline inventories improved slightly from very low levels in the Midwest, but remained at very low levels in the South Atlantic in the aftermath of Tropical Storm Fay. You may remember we were close to running out of sufficient gasoline supplies a week ago in the upper Midwest - and the lower south East.
Going forward, I expect gasoline imports to remain below last year's levels.
Domestic oil production dropped 170,000 bpd in just one week, and oil supplies at the Cushing, OK futures delivery point also continued to drop. My WAG is that this is connected with the Sem Group bankruptcy of a month ago, which is a major buyer and storer of oil in Cushing. There are legal reports that many small, low volume oil producers have yet to replace their oil delivery contracts with Sem Group and/or are awaiting action in the bankruptcy court to get paid. This is one of those "above ground factors" restricting oil production that we can't accurately predict, but keep occurring with greater frequency. Need I mention the 20 day shut-down of the BTC pipeline across Georgia, and the loss of 17 million barrels of crude shipments (mostly to Europe).
So in sum, we are still above minimum operational levels for oil, gasoline, and diesel - except maybe not by much for gasoline in Florida - but Hurricane Gustav looks like it will give us a real world test of just where those MOLs are. Needless to say, we also see further and very significant drops in domestic oil production as oil service workers are evacuated ahead of the storm. _________________ It's already over, now it's just a matter of adjusting.
Exports went way down when we expected them to be up.
It looks like JP6 is running short on money.
He is probably waiting to the last minute to buy his winter heating oil.
It could be a cold, cold winter for a lot of Americans.
Well, we had fun this week, despite being whipped up on by the analysts. As DP points out, the unleaded imports accounted for an additional 4 million barrels of extra supply.
The crude oil imports came in at 10.0, which is in the ballpark of what we expected. The refinery utilization was over 87%, which represents a recovery of sorts since before Edouard.
The distillate imports were a little higher than we thought, which accounted for the entire .9 million barrels of our deviation from the forecast.
The unleaded "demand gap" was essentially zero again, for the second week in a row. I am going to have to readjust my model to accommodate lower unleaded demand again.
So, it appears that the imports have bailed us out once again on the finished products. There is still a lot of crude oil around, and we are still a little iffy on distillates, which should be building this time of year.
Next week is going to be even tougher to forecast, though.
Posted: Wed Aug 27, 2008 11:32 am Post subject: Re: Weekly US Petroleum and NG Supply Reports (Current)
TheDude wrote:
This is odd:
Finished gasoline in inventory decreases over time while the amount of blending components has taken off since 2004, currently reaching rough parity (101856 mb vs. 105580 mb). The NPC gives a MOL for gasoline of 185 mb, here are their remarks:
Quote:
While inventories continue to fluctuate seasonally,
the average level has remained flat since the last
study. In addition, the low inventory level reached
during the mid-1998 to 2004 time period was no
lower than the minimum reached during the previous
study’s time period (1992 to mid-1998). Since
the last study, inventories approached the LOI only
once, reaching 188 million barrels at the end of
October 2000. This was essentially the same as the
prior minimum level observed in August 1997.
As discussed in the 1998 study, oxygenates are an
important part of the U.S. motor gasoline supply
system and should be considered when evaluating
the capability of the supply system to respond to
market forces. Since the 1998 study, the role of oxygenates
has become more complex with MTBE bans
in several states and the continued oxygenate
requirement in reformulated gasoline. As a result,
ethanol markets have expanded beyond the Midwest
and ethanol is now used for gasoline production in
both the Northeast and California. The transportation
and inventory management systems for ethanol
are largely out of the control of petroleum industry
companies and the ethanol industry’s capability to
meet demand is beyond the scope of this study.
As my chart displays, the trend NPC were remarking on has proceeded unabated since their paper was published. I assume this is considered a healthy state of affairs...with Mexico's continuing production decline they'll be attempting to import more and more finished product, while we have less and less on hand for them from the looks of things. And more and more ethanol in the distribution system will lead to increased corrosion of pipe, among other problems. Maybe it's all a half-baked make work project...
That is an important point that I had also noticed, and that chart is a great illustration of the problem.
As much as we know, those blending components may be essentially ethanol.
At the very least, it is hard to believe that they are stored in the exact proportion used to turn them into finished gasoline:
What could be the rational for keeping a regularly increasing storage of components (immobilising greater and greater working capital, in this increasingly just-in-time world) if they were simply being stored in the exact proportions needed to turn them into gasoline?
Posted: Wed Aug 27, 2008 1:33 pm Post subject: Re: Weekly US Petroleum and NG Supply Reports (Current)
Ming wrote:
TheDude wrote:
This is odd:
Finished gasoline in inventory decreases over time while the amount of blending components has taken off since 2004, currently reaching rough parity (101856 mb vs. 105580 mb). The NPC gives a MOL for gasoline of 185 mb, here are their remarks:
Quote:
While inventories continue to fluctuate seasonally,
the average level has remained flat since the last
study. In addition, the low inventory level reached
during the mid-1998 to 2004 time period was no
lower than the minimum reached during the previous
study’s time period (1992 to mid-1998). Since
the last study, inventories approached the LOI only
once, reaching 188 million barrels at the end of
October 2000. This was essentially the same as the
prior minimum level observed in August 1997.
As discussed in the 1998 study, oxygenates are an
important part of the U.S. motor gasoline supply
system and should be considered when evaluating
the capability of the supply system to respond to
market forces. Since the 1998 study, the role of oxygenates
has become more complex with MTBE bans
in several states and the continued oxygenate
requirement in reformulated gasoline. As a result,
ethanol markets have expanded beyond the Midwest
and ethanol is now used for gasoline production in
both the Northeast and California. The transportation
and inventory management systems for ethanol
are largely out of the control of petroleum industry
companies and the ethanol industry’s capability to
meet demand is beyond the scope of this study.
As my chart displays, the trend NPC were remarking on has proceeded unabated since their paper was published. I assume this is considered a healthy state of affairs...with Mexico's continuing production decline they'll be attempting to import more and more finished product, while we have less and less on hand for them from the looks of things. And more and more ethanol in the distribution system will lead to increased corrosion of pipe, among other problems. Maybe it's all a half-baked make work project...
That is an important point that I had also noticed, and that chart is a great illustration of the problem.
As much as we know, those blending components may be essentially ethanol.
At the very least, it is hard to believe that they are stored in the exact proportion used to turn them into finished gasoline:
What could be the rational for keeping a regularly increasing storage of components (immobilising greater and greater working capital, in this increasingly just-in-time world) if they were simply being stored in the exact proportions needed to turn them into gasoline?
My best guess is that even with storage of the corn you still have a very seasonal supply variation in ethanol and we need a lot more ethanol storage to ensure a steady supply throughout the year.
I think it all depends on if its better to store ethanol or store the grain. It looks like for market reasons its better to buy the ethanol when its cheapest and store it vs storing the grain and distilling it just in time.
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