Worth Reposting: Saudi Blowing Smoke -- Bloomberg -- June 4, 2017

Updates

June 4, 2017: Saudis just blowing smoke -- Bloomberg. Nice update of the three Motiva refineries: Port Arthur in Texas (Saudi Aramco); Norco, Convent in Louisiana (Shell). The Shell refineries take very little Saudi Arabian oil; Port Arthur takes 238,000 bopd from Saudi Arabia (21% of all Saudi crude sales to the US. To the other two refineries, only 33,000 bopd sourced from Saudi Arabia.

Crude loading during June in Saudi Arabia will arrive off the U.S. coast between mid-July and mid-August. By then, refinery runs will already be at their seasonal peak and attention will be starting to turn towards the fall slowdown, which typically gets under way around the end of July. This may allow the Saudis to claim a seasonal downturn as evidence of cuts.

Bloomberg tanker tracking data shows Saudi crude exports to the U.S. in May at around 840,000 barrels a day. That is a drop of 160,000 barrels from April. Significant? Perhaps, but it only takes them back to where they were in January, the first month of the output deal.

From the Bloomberg article, this is an interesting chart. I did not know this. I assume nearly 100% of Saudi oil coming to the US was going to "Motiva." It turns out that only about a quarter of Saudi oil coming to the US ends up at "Motiva."

May 28, 2017: perhaps the graph below explains why the Vienna meeting was a bust for OPEC. LOL.  
 

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Note how much higher OPEC production is today -- after the production cuts -- than it was in 2014, prior to the production cuts. I guess it's how one defines "production cuts."

Thought experiment: overlay this chart with US shale production during same period of time.