EIA Weekly Petroleum Report -- September 21, 2022

All my posts are done quickly: there will be content and typographical errors. If anything on any of my posts is important to you, go to the source. If/when I find typographical / content errors, I will correct them. 

Updates

September 22, 2022: From the view of The [London] Mail. 

Original Post

"Fed" rate: up 0.75%.  Up 75 basis points.

• to 3.00 - 3.25% range.
• target: 4.4% for the year
• "higher for longer"
• no reductions until 2024 
• doesn't see 2% inflation -- their target -- until 2025 -- three years from now. Wow.
  

Equity market:

• the Fed rate increase at 75 basis points is so much better than 100 basis points, so market should have risen;
• but, the "higher for longer" narrative turned the market down

Analysts:

• many analysts think "the Fed" is going farther than it needs to go;
• what these analysts are missing is that the Biden administration is going to keep spending more money, much more money
• and, yes, the risk of recession has become worse, but it beats nine-percent inflation
• based on historical averages, this aggressive rise in the rates means long-term investors have upwards of 600 days for more buying opportunities. Whoo-hoo!
  

Huge inverted rate curve:

• two-year at 4.1%.
• ten-year at 3.6%.

GDP forecast significantly lower: down to a mere 0.2%.

WTI: pretty much flat at $83.58.

EIA weekly petroleum report, link here:

• US crude oil inventories increased by 1.1 million bbls
• refineries operating at 93.6% of their operable capacity
• gasoline inventories increased
• distillate fuel inventories increased by 1.2 million bbls
• distillate fuel still 18% below their five-year average
• total commercial petroleum inventories increased by 9.2 million bbls last week
• SPR releasing about one million bbls per day, or seven million bbls / week

Gasoline demand pending.

Imagine:

• despite gasoline demand well off record highs (from 2019, before the year of the plague);
• Saudi Arabia producing at record levels;
• US releasing one millions bbls of oil per day from the SPR; and, yet,
  
• US commercial supplies increased by only one million bbls for the week

US operators:

• there's probably a reason US operators are more interested in returning cash to their shareholders than drilling more.