The NDIC oil and gas website is coming back up very quickly but there are still glitches preventing me from getting to most NDIC sites. That's fine. It should eventually be back to "a new normal."
The daily activity report was not posted yesterday, for Monday, May 23, 2022. It may be posted now, but I'm moving on. Will check again tomorrow.
It appears the "new" NDIC oil and gas website does not work with Firefox (my favorite browser) and is intermittently working with Safari (the Apple browser). So far, it continues to work with Chromium (the google browser with "least" security protections -- and I guess that's why it continues to work).
WTI: $110.60.
Active rigs: 39 or thereabouts.
RBN Energy: will high crack spreads be enough to balance refined products markets, part 2. For me the answer is irrelevant. It will be what it will be. The importance of this post today is the understanding that:
- oil production is not the primary mover for the price of gasoline;
- takeaway capacity, in general, is no longer an issue, except in places like New England and Long Island;
- the high price of gasoline is being driven by refinery issues, and it's a lot more difficult to manage refinery issues than drill, produce, and transport more oil.
U.S. diesel inventories are at their lowest level for May since 2000 and East Coast stocks recently hit their lowest mark for any week or month since the EIA started tracking them in 1990. Crack spreads for diesel — and, more recently, for gasoline — have gone parabolic, giving refiners the strongest financial signal ever to produce more diesel and gasoline as we enter the summer travel season. More jet fuel too. The problem is, U.S. refineries already are running flat-out. And Europe? It’s facing big cuts in crude oil and refined-products imports from Russia as well as much higher prices for — and possible shortages of — oil and natural gas, the latter being the primary fuel for operating refinery hydrocrackers, which upgrade low-quality heavy gas-oils into high-quality diesel, gasoline and jet. It’s a mess, and not easily fixable, as we discuss in today’s RBN blog.
U.S. and global energy markets have always had challenges to deal with — nothing so far-reaching, multifaceted and interdependent can run as reliably and smoothly as a Swiss watch, whose gears and springs operate within a glass-and-gold vacuum. But it would be hard to find a time when energy markets are in as much disarray as they are today. The COVID pandemic, a precipitous economic slowdown (and partial rebound), a nascent energy transition, Russia’s war on Ukraine, and China’s big-city lockdowns, among other things, have combined to wreak havoc, with the most significant effect being supply/demand imbalances that have propelled prices for crude oil and refined products (and natural gas) sharply higher.
The shortage of refining facilities is due to the Suncor refinery explosion in Philadelphia in 2019 and the Marathon oil refinery explosion in Garyville that took out the Hydrocracker. Suncor refinery is closed, likely Marathon will repair/replace the hydrocracker, likely to take a year or more. It's an expensive piece of hardware...
ReplyDeleteSimilar situation with the computer memory problems of 2008, every was losing money
Thank you. That gives me an idea for the blog, a question.
Delete