Oil's energy contribution has declined by about 12% since 1999. The world's economies have also declined by about 12%. (Using conventional metrics, which are time delayed determinations, this will only be seen in hind sight). The massive destruction of asset values now occurring testifies to it happening.
Peak is well behind us, world economies have peaked and will continue to decline.
Posted: Wed Sep 17, 2008 7:32 pm Post subject: Re: Weekly US Petroleum and NG Supply Reports (Current)
Prices in Canada spiked 12 cents per liter just before Ike hit, and then fell back down this week about 9 cents. The claim was that damage to infrastructure was less than expected. There was outrage that the price of gas went up when oil fell. "Big oil is just using the hurricane as an excuse to screw us." Cheap gas is a national right here in Canada, since we produce so much oil. I dont think most people understand that Canada imports gasoline from the US.
Joined: Apr 06, 2006 Posts: 3626 Location: 3 miles NW of Champoeg, Republic of Cascadia
Posted: Thu Sep 18, 2008 4:05 am Post subject: Re: Weekly US Petroleum and NG Supply Reports (Current)
OilFinder2 wrote:
Just as an anecdote, I have seen no gasoline price spikes here in the Seattle area. Gas at all the stations I drive by or go to is pretty much the same price it's been for the past week or two. I've also seen no lines, and no stations out of gas.
However, given that "up here" we're as far as you can get in the Lower 48 from the Gulf coast, it's probably not surprising. I read somewhere a while ago that most, if not all, of our oil up here comes from Alaska. Don't know if that's still true, but if it is, it would explain why there's been no "hurricane effects" here.
Gas station owners cant jack prices while wholesale is falling, and while anti price gouging laws are in effect, so it appears they will pump their underground tanks dry.
I, a big fan of logic and rational behavior, continue to be amazed by this situation.
We can pretty easily compute the needed gas price to get the refiners excited about producing again, and we are probably about 50 cents below it.
So, we are in another period where we know things are going to change.... it cannot go on like this much longer.
Purely emotional response - local politicians responding to the ire of their constituency, not surprising at all to me. People want scapegoats and have no idea of the workings of the national fuel distribution system. It'll be a hard sell to convince voters to pay more like they do in Europe, at first anyway; shifting taxes around should be easy enough to implement, of course, but with the macro economic edifice crumbling at an accelerating rate chances are there'll be no way to do that either...behavior shifts will be mandatory in the end.
Quote:
Also, running out of gas is the penalty we will get for demonizing the oil companies.
For what? Can't blame them for trying to maintain a decent crack spread by running down inventories when it was $147/bbl. And the net gain from angry voters has been what, exactly? We weren't energy independent in 1973, either. These crisis situations yield little of value once complacency sets in again. This is a more a failure of our political system I think; and the attendant sloth from having all these energy slaves on hand.
We've dug ourselves into a 13 ft. hole, might as well go down another foot or two before the rain water drowns us. I hope to be reincarnated as a bird. _________________ Cogito, ergo non satis bibivi
C'mon man, who're you gonna believe?
Posted: Thu Sep 18, 2008 7:49 am Post subject: Re: Weekly US Petroleum and NG Supply Reports (Current)
TheDude said:
Quote:
These crisis situations yield little of value once complacency sets in again. This is a more a failure of our political system I think; and the attendant sloth from having all these energy slaves on hand.
We've dug ourselves into a 13 ft. hole, might as well go down another foot or two before the rain water drowns us. I hope to be reincarnated as a bird.
It appears that we are far enough down the TAE (Total Available Energy) curve (Available Energy) that we can expect to see one fuel crisis after another from this point forward.
They will come like rolling black outs. Hurricane, revolution in some oil producing country, refinery fire, financial crisis ..... etc. They will all be a product of PO, but ascribed to some other cause. Complacency will eventually succumb to anger and fear!
Joined: Oct 23, 2004 Posts: 5928 Location: New Jersey
Posted: Fri Sep 19, 2008 3:46 pm Post subject: Re: Weekly US Petroleum and NG Supply Reports (Current)
Leanan found this article about a very rare pre-announcement concerning a large drop in gasoline inventories in next week's report.
Meanwhile the supply situation across the country gets worse. As of last night there were 15 states/districts requesting fuel waivers. I expect that number to increase today or Monday.
Quote:
Gasoline Supply May Fall `Substantially,' Energy Official Says
By Barbara Powell
Sept. 19 (Bloomberg) -- The Energy Department's Sept. 24 inventory report may show that U.S. gasoline supplies fell 8.5 million barrels from a four-decade low as Texas refineries assess damage from Hurricane Ike, a department official said.
``Probably the max is an 8.5 million draw in gasoline because demand is down, and it could be as low as 6.5 million'' barrels, John Duff, survey manager for the Energy Department's weekly petroleum status report, said in an interview. The report will show ``the real impact of the hurricane on the refining sector,'' he said. Supplies will fall ``substantially.''
Pemex Crude Shipments Continue to Meet Delays in U.S. Gulf Coast
September 19
Pemex, the third largest supplier of crude to the U.S., said its regular oil shipments to Gulf of Mexico refineries have been delayed since September 12 because of Hurricane Ike.
Bloomberg News, 17:42 September 19, 2008 _________________ It's already over, now it's just a matter of adjusting.
Posted: Fri Sep 19, 2008 6:51 pm Post subject: Re: Weekly US Petroleum and NG Supply Reports (Current)
DantesPeak wrote:
Leanan found this article about a very rare pre-announcement concerning a large drop in gasoline inventories in next week's report.
Meanwhile the supply situation across the country gets worse. As of last night there were 15 states/districts requesting fuel waivers. I expect that number to increase today or Monday.
Quote:
Gasoline Supply May Fall `Substantially,' Energy Official Says
By Barbara Powell
Sept. 19 (Bloomberg) -- The Energy Department's Sept. 24 inventory report may show that U.S. gasoline supplies fell 8.5 million barrels from a four-decade low as Texas refineries assess damage from Hurricane Ike, a department official said.
``Probably the max is an 8.5 million draw in gasoline because demand is down, and it could be as low as 6.5 million'' barrels, John Duff, survey manager for the Energy Department's weekly petroleum status report, said in an interview. The report will show ``the real impact of the hurricane on the refining sector,'' he said. Supplies will fall ``substantially.''
Expectation management? I guess they won't be announcing anything greater than 8.5 million now, no matter what the actual number was. Any anouncement less than 8.5 million could be interpreted as bearish by the traders given how irrational they've shown themselves to be.
Joined: Oct 23, 2004 Posts: 5928 Location: New Jersey
Posted: Fri Sep 19, 2008 7:09 pm Post subject: Re: Weekly US Petroleum and NG Supply Reports (Current)
Quote:
Expectation management?
At the time this news came out, the price of oil was acting rather subdued, so they probably thought it was a good time to manage expectations. Any casual reader of this thread knows that frequently the price oil reacts based upon expectations, and not the actual number. Although occasionally it is suddenly discovered after the fact that, for example, the LOOP was closed (when it actually wasn't).
So yes, they are setting a very low target so the news is "better than expected". Isn't that what really matters, and not how poor the condition of US gasoline inventories really are? [/sarcasm]
PS - Some in the oil import industry expect gasoline imports to increase to about 1.5 mbpd in the next two calendar weeks (which would not show up until the October 1 report). _________________ It's already over, now it's just a matter of adjusting.
Posted: Fri Sep 19, 2008 7:32 pm Post subject: Re: Weekly US Petroleum and NG Supply Reports (Current)
DantesPeak wrote:
Quote:
Expectation management?
At the time this news came out, the price of oil was acting rather subdued, so they probably thought it was a good time to manage expectations. Any casual reader of this thread knows that frequently the price oil reacts based upon expectations, and not the actual number. Although occasionally it is suddenly discovered after the fact that, for example, the LOOP was closed (when it actually wasn't).
So yes, they are setting a very low target so the news is "better than expected". Isn't that what really matters, and not how poor the condition of US gasoline inventories really are? [/sarcasm]
PS - Some in the oil import industry expect gasoline imports to increase to about 1.5 mbpd in the next two calendar weeks (which would not show up until the October 1 report).
Why would imports increase with wholesale prices so low?
Posted: Fri Sep 19, 2008 8:11 pm Post subject: Re: Weekly US Petroleum and NG Supply Reports (Current)
sjn wrote:
Why would imports increase with wholesale prices so low?
I read they were expecting huge imports to show b/w 9/25-10/2. Personally, I'll believe it when it happens but it does make sense since every quoted industry source is basically calming nerves and stalling for time.
I don't think this situation as anything to with price. The exporters/oil companies will not want to lose major face with their most valuable consumer market.
"We panicked and looked online," she said. "And holy cow, there is no gas in the city. ... It has definitely gripped the city, for sure."
One store clerk told her there was no way she could get gas to go back home, she said.
Williams said some drivers were following gas trucks to see where they were headed, and lines at some stations were a mile long. Fuel was continuing to enter the city, however, as pipelines were working and barges were coming in. _________________ Got Dharma?
Joined: Apr 13, 2005 Posts: 3273 Location: St.Louis, Mo
Posted: Sat Sep 20, 2008 8:23 am Post subject: Re: Weekly US Petroleum and NG Supply Reports (Current)
OilFinder2 wrote:
Just as an anecdote, I have seen no gasoline price spikes here in the Seattle area. Gas at all the stations I drive by or go to is pretty much the same price it's been for the past week or two. I've also seen no lines, and no stations out of gas.
However, given that "up here" we're as far as you can get in the Lower 48 from the Gulf coast, it's probably not surprising. I read somewhere a while ago that most, if not all, of our oil up here comes from Alaska. Don't know if that's still true, but if it is, it would explain why there's been no "hurricane effects" here.
When the EIA takes the extraordinary step of announcing the previous week that the unleaded inventory will decline X amount, who am I to argue with it? The only thing to do is try to understand how we arrived at this point. In order to decline by 8.5 mbpd, given the demand of about 9.3 (balance) mbpd, you have to have some combination of imports and domestic production that adds up to about 8 mbpd. Given that the gulf coast ports were mainly down, and given that the last few weeks have seen about 1.1 mbpd in imports, maybe it's 1 and 7. It will be interesting to see what happens on this. As of yesterday we still had over 2 mbpd refinery capacity down along the gulf coast.
If the refineries are down, they should not be drawing down crude oil, however, the ports were also down, so we could not import crude oil. I have a lot of trouble forecasting imports as it is, of course. Maybe 9.5 mbpd imports is the "base level" right now. Even the week that Gustav hit, we got in no less than 8 mbpd, but the ports were probably more affected by the storm (especially the HST) than last time.
so with conservative input s and pessimistic domestic production, you can back work and end up with crude oil sent to refineries of about 12.5.
So the predicted big draw in unleaded, the corresponding draw in distillates, and a much smaller draw in crude oil, becasue the refineries are down. We will see.
Joined: Oct 23, 2004 Posts: 5928 Location: New Jersey
Posted: Mon Sep 22, 2008 3:55 pm Post subject: Re: Weekly US Petroleum and NG Supply Reports (Current)
Thanks pup55 for your in-depth analysis.
Curiously, even as nine refineries in the Gulf area remain totally shut at this moment, the wholesale price of gasoline continues to generally decline (although up the last few days).
While there is no sign of gasoline shortages in the Northeast US north of the Mason-Dixon line, I continue to believe the price 'signal' from the markets is broken, and we will see gas shortages spread out from the Mid-Atlantic states. If the price system was working properly, you wouldn't have seen oil rise almost $30 in just a few days on relatively little fundemental news.
Perhaps the actual release of the gasoline inventory report will shock some sense into the market, but maybe not. _________________ It's already over, now it's just a matter of adjusting.
Posted: Mon Sep 22, 2008 5:06 pm Post subject: Re: Weekly US Petroleum and NG Supply Reports (Current)
Quote:
I continue to believe the price 'signal' from the markets is broken, and we will see gas shortages spread out from the Mid-Atlantic states.
It's actually quite interesting.... normally, if there is a shortage situation like there is in the southeast, the rationing mechanism is to raise the prices. Not now, however. I think these station owners are so sensitive to people accusing them of gouging that if the spot price gets excessive, they literally walk away from their business rather than risk catching hell from the local authorities.
Joined: Oct 17, 2005 Posts: 145 Location: Saratoga County, NY
Posted: Tue Sep 23, 2008 8:25 am Post subject: Re: Weekly US Petroleum and NG Supply Reports (Current)
There is one Citgo station on my way to work that was $3.51/gal unleaded for about 4 weeks straight. Right after Ike, they went up to $3.71, but immediately started coming back down and today they are back at $3.51. Yes, there are often lines to get to the pumps.
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