Thursday, March 4, 2021

Idle Comments On That 20+ Million-Bbl Build Last Week -- March 4, 2021

That 20+ million bbl crude oil build could have been 30-million bbls. See this link. Some things to consider with regard to the Texas February Freeze:

  • prior to the EIA weekly report, there were forecasts that there would be a 2-million-bbl withdrawal, which is/was very much in line with previous reports, and typical of weekly EIA petroleum reports;
  • in the big scheme of things, nationwide, there was not much of a drop in economic activity across the US during the Texas February Freeze, February 15 - February 19, 2021
    • even in Texas, the overall economic activity probably did not drop all that much; 
    • in fact, hotels were booming; plumbers were busier than ever; propane dried up, it was in such demand; 
    • confirmed by no change in gasoline demand, a pretty good indicator of economic activiity;
  • reports were coming out of the Permian that "everything" was shut down; i.e., no crude oil production;
  • reports within days following the unfavorable event suggested that refineries, though hit hard, were opening up
  • there were reports that one out of seven service stations in north Texas were out of gasoline, I didn't see that; hurricanes cause much more regional trouble
  • gasoline demand remained pretty much unchanged week/week according to this week's EIA report
  • I'm hoping that RBN Energy blogs about that 20+ million bbl build -- in hindsight, it all makes sense, but it certainly seems to have caught analysts off guard

Cushing:

  • according to wiki: crude oil tanks around Cushing have approximately 91 million bbls of storage capacity;
  • from a reader citing ZeroHedge:
  • API had Cushing +732k barrels; EIA had Cushing +485k
  • in other words,
  • the EIA reported a 20+ million-bbl build in crude oil in the US last week
  • EIA and API both had Cushing builds well below one million bbls;

2 comments:

  1. excess storage went to the gulf coast. look at crude oil stocks on link below
    https://www.eia.gov/petroleum/weekly/crude.php#menu
    Increase in crude oil stocks was offset by about 20mm bbl of gasoline, jet fuel, and distillate fuel oil.

    Cold weather shut down up to 4mm bbl/day of refinery processing.

    ReplyDelete
    Replies
    1. "We" all saw that. How did the analysts miss that. They were suggesting a withdrawal of as much as 2 million bbls; when in fact there was a build of 20+ million, and perhaps as much as 30 million bbls.

      I'm pretty sure I know the answer -- how the analysts missed it -- but I won't post it. I just hate all the pushback.

      I will wait for RBN Energy to post their analysis. I'm beating a dead horse but it's a very important dead horse to beat.

      Again, if "we" all saw it, how did the analysts miss it?

      Delete

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