It's going to be tough to sort out the top energy stories for the year.
But with all the folks over at Twitter heralding this story, one begins to think it's going to be a big, big story. I think this is the third or fourth link regarding this story that I've posted on the blog in the last two days.
Again, from another source, this time from a contributor over at SeekingAlpha:
- US crude imports are about to set a new monthly low this month. We are seeing October US crude imports coming in at ~6 mb/d
- next week will show elevated imports of ~7 mb/d followed by sub ~6 mb/d for the following three weeks.
- the reasoning behind such low imports is largely thanks to elevated demand pull from Asia and the rest of the world.
- now for a reference point, US crude imports were 7.544 mb/d in October last year.
- so the combination of low crude imports and elevated crude exports this month will see US crude storage counter-seasonally decline.
I would be pretty leery of articles that SA author, HFIR. He was one of the shale naysayers for a long time. Those saying it was stalled in fall 2017 for instance. To his credit, he did slowly and then fully adjust his position on US production growth after the US grew strongly (3 MM bopd, in 18 months from JUN17 to DEC18). I'm also not that impressed with his analysis in general (seen math and logic mistakes). He's just another person on SA setting himself up as an expert and trying to sell investment advice. But he's not really a real analyst.
ReplyDelete2. I wonder how important a one month change in imports is. Actually even if it persists, is it really that momentous? For example, let's say tanker costs have gone up (they have) and then Bakken oil that was getting exported from Houston instead heads to the East Coast refineries on trains. I mean then its just less oil getting imported into Philly and more heading in by train. But for the world markets, it's not that important.
Yes, there's some Brent not going into Philly. But there's a corresponding drop in US export volumes. Maybe it's just normal flexibility of marketing to different regions, based on changes in transport pricing.
It's interesting you say that about HFIR. It seems I remember something along this same line about HFIR before -- I can't recall but it seems I was wary of something HFIR had recently written. Having said that, over at twitter there have been a lot of posts about the drop in imports they expect to see. It will be interesting to see how this plays out.
DeleteMaybe I need to stick to simply reporting activity in the Bakken and stay away from these other stories. Small chuckle.
Seriously, thank you for taking time to write.
Don't let my critical analysis rob you of joy. I just like thinking about the same topics.
ReplyDeleteYou just love watching me make a fool of myself. LOL. Don't worry. I'm sure I won't change much in my blogging.
Deleteah, that's the story of next year, not this year....it will take the media at least that long to understand our low imports are due to "elevated demand pull from Asia and the rest of the world."
ReplyDeleteLOL. But I did find that interesting when I read that ... just another way of saying the rest of the world has huge demand for energy ...
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