The Numbers Are Simply Staggering: Henry Hub Supply Receipts Show A Five-Fold Increase Since 2016 -- RBN Energy -- March 13, 2018; XOM Will Double Gulf Coast Refining

XOM to expand Gulf Coast oil-refining expansion: Tillerson may be out, but XOM is not. Reuters confirms that it will expand Gulf Coast oil-refining. That's an understatement: in fact, XOM will double US light crude oil refining capacity along the US Gulf Coast. This is a very, very big story. US Gulf Coast refineries were optimized for heavy oil some years ago at great expense; I never thought Gulf Coast refiners would to back to light oil -- but apparently they've seen the writing on the wall: heavy oil is very, very iffy:

• huge amounts of light oil coming in from the Permian, Eagle Ford, and the Bakken
• Canadian heavy oil via Keystone XL is iffy
• Venezuelan heavy oil is iffy
• Saudi "heavy oil" is iffy

From the story:

Exxon’s proposed project, which has not received a final investment decision, would be the first major expansion of gasoline and motor fuels production in the nation in six years.

Exxon’s Beaumont, Texas refinery could become the nation’s largest by capacity when the work is complete in the next decade.

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New ethane cracker: speaking of XOM/Baytown refinery, this is another story of interest. I had not planned to post -- just too much stuff to keep track of, but in light of XOM's plans to expand, I thought this needed to be posted. From one of many links, Chevron Phillips Chemical starts ethane cracker:

Chevron Phillips Chemical on Monday announced the startup of its first new U.S. ethane cracker in decades ....

At full capacity, it will produce 1.5 million tons of ethylene a year to turn into pipes, films, containers and other plastic products.

The new supply of ethylene will support the production of polyethylene — the world's most common plastic — at the company's Old Ocean facility near Sweeny. There, it built two new polyethylene units that began operating in September with the combined capacity to produce 4.4 billion pounds of plastic resins a year.

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SecState: Rex Tillerson is out. CIA director Mike Pompeo to be successor. Perhaps Mr Tillerson wasn't "all that sick" in Africa as reported the other day.

API crude oil inventory data: will be released this afternoon. Link here.

• forecast: an increase of 2.023 million bbls
• actual: an increase of 1.156 million bbls

CPI: came in exactly as forecast. Year-over-year, 1.8%; month-over-over, 0.2% which is slightly lower than 0.3% in the previous month. These are incredibly good numbers in light of other economic data the past few weeks.

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Back to the Bakken

Active rigs:

$61.06↓	3/13/2018	03/13/2017	03/13/2016	03/13/2015	03/13/2014
Active Rigs	60	46	32	112	191

RBN Energy: LNG exports driving physical gas flows, constraints at Henry Hub, part 2.

Natural gas flows and market dynamics are shifting at national benchmark Henry Hub.

Supply receipts at Henry this year to date have doubled since the comparable period last year to nearly 450 MMcf/d, on average. That’s also a five-fold increase from the same period in 2016.

In fact, current gas flows through the hub are the highest we’ve seen since 2009. The last time we saw this level of flows through the hub was when Gulf of Mexico offshore gas production volumes — much of which hit the U.S. pipeline system in southern Louisiana — were still topping 6.0 Bcf/d. That was also before the Marcellus/Utica Shale gas supply ballooned, effectively emptying out the pipeline capacity that used to flow gas north from the Gulf Coast.

Now, many of those pipelines have reversed flows and the hub is showing signs of becoming a destination market for that Northeast gas and other supply targeting LNG export demand on the Gulf Coast. Today, we continue our short series looking at the changing physical flows at Henry Hub.