Back to Analyst

Gasoline surplus continues with oil showing a steady draw

|

The Energy Information Administration (EIA) released its weekly data on the status of petroleum inventories in the United States. Here are some of the report’s highlights:

CRUDE INVENTORIES:
Crude oil inventories decreased by 6.0 million barrels (MMbbl) to a total of 465.0 MMbbl. At 465.0 MMbbl, stockpiles are 4.2 MMbbl below last year (0.9%) and are in the upper half of the average range for this time of year. Inventories at the major delivery point in Cushing, OK rose 1.5 MMbbl to a total of 62.5 million barrels.

GASOLINE INVENTORIES:
Gasoline inventories increased by 1.6 million barrels (MMbbl) to a total of 218.9 MMbbl. At 218.9 MMbbl, stockpiles are down 8.5 MMbbl, or 3.7% lower than a year ago and are in the upper half of the average range for this time of year.

Here’s how individual regions and their gasoline inventory fared last week:
– East Coast (+1.1 MMbbl)
– Midwest (-1.5 MMbbl)
– Gulf Coast (+1.9 MMbbl)
– Rockies (-0.2 MMbbl)
– West Coast (-0.02 MMbbl)

It’s important to note which regions saw increases/decreases as this information likely drives prices up (in the case of falling inventories).

DISTILLATE (DIESEL, HEATING OIL) INVENTORIES:
Distillate inventories decreased by 2.6 million barrels to a total of 135.4 MMbbl. At 135.4 MMbbl, inventories are down 25.3 MMbbl, or 15.6% lower vs. a year ago.

IMPLIED DEMAND:
Gasoline supplied to end users amounted to 9.24 million barrels per day, or 281,000 bpd lower than the previous week. So far in 2017, gasoline supplied is 1.9% lower versus 2016, according to the EIA

REFINERY OUTPUT/UTILIZATION:
Refinery utilization increased by 0.5 % vs. last week’s numbers to 88.1%. Gasoline production increased to 10.2 million barrels per day, while distillate fuel production increased to 4.9 million barrels per day last week.

Utilization rates for the last week were as follows:
– East Coast: 85.1 (down 10.7%)
– Midwest: 89.7% (down 0.2%)
– Gulf Coast: 85.6% (up 1.2%)
– Rocky Mountain: 97.5% (down 0.5%)
– West Coast: 93.0% (down 1.0%)

These percentages show how much a region’s overall capacity was used to refine oil.It’s important to note these percentages, because the lower the utilization percentage, the lower output – which gas a direct impact on local gasoline prices. If refiners in your region have low output, you’re more likely to see gas prices rise.

OVERALL SUPPLY:
Total oil stocks in the United States are down by 60.1 MMbbl (-4.1%) over last year and stand at 129.4 billion barrels (excluding the Strategic Petroleum Reserve).

IMPORTS/EXPORTS:
The U.S. imported 7.21 MMbbl of crude per day last week, down by 213,000 bpd vs. the previous week. Total motor gasoline imports last week averaged 862,000 bpd. The U.S. also imported 72,000 bpd of distillate fuels. However, during the same timeframe, the U.S. exported 640,000 bpd of finished gasoline and 1.366 mbpd of distillates. In total, U.S. refineries exported 8 MMbpd of oil and petroleum products.

Shortly before the EIA report was released, oil was trading down 14 cents per barrel at $50.28. Following the report’s release, oil prices were down 44 cents a barrel while gasoline rose $1.12 cents a gallon.

Senior Petroleum Analyst, Canada

Dan is a skilled and noted bilingual (French and English) consumer advocate specializing in energy and current affairs. Known as Canada's “Gas Guru,” he founded tomorrowsgaspricetoday.com to better help motorists anticipate the price of gasoline in advance across Canada. He has over three decades of experience in the petroleum industry, as a parliamentarian and an analyst.

Peak Oil? Not So Fast
|