EIA Confirms API Data -- US Crude Oil Inventories Continue To Increase -- March 7, 2018

The weekly petroleum report:

• US crude oil inventories: increased by 2.4 million bbls; now at 425.9 million bbls

Market response: WTI drops over 1%; now trading below $62

Other data from the weekly petroleum report:

• refineries: operating at 88% of operable capacity; still well below their potential
• despite decreasing gasoline production, still well above the "average" range
• other data pretty much uninteresting or unchanged 

Re-balancing: moving in the wrong direction -- back to 29 weeks -- the highest in eleven (11) weeks -- it was 30 weeks back on December 20, 2017.

Week	Date	Drawdown	Storage	Weeks to RB
Week 0	Apr 26, 2017		529.0	180
Week 24	October 12, 2017	2.8	462.2	40
Week 25	October 18, 2017	5.7	456.5	37
Week 26	October 25, 2017	-0.9	457.3	39
Week 27	November 1, 2017	2.4	454.9	38
Week 28	November 8, 2017	-2.2	457.1	42
Week 29	November 15, 2017	1.9	459.0	43
Week 30	November 22, 2017	1.9	457.1	42
Week 31	November 29, 2017	3.4	453.7	41
Week 32	December 6, 2017	5.6	448.1	37
Week 33	December 13, 2017	5.1	443.0	36
Week 34	December 20, 2017	6.5	436.5	30
Week 35	December 28, 2017	4.6	431.9	28
Week 36	January 4, 2018	7.4	424.5	25
Week 37	January 10, 2018	4.9	419.5	23
Week 38	January 18, 2018	6.9	412.7	20
Week 39	January 24, 2018	1.1	411.6	20
Week 40	January 31, 2018	-6.8	418.4	24
Week 41	February 7, 2018	-1.9	420.3	26
Week 42	February 14, 2018	-1.8	422.1	27
Week 43	February 21, 2018	1.6	420.5	27
Week 44	February 28, 2018	3.0	423.5	28
Week 45	March 7, 2018	2.4	425.9	29

Catching Up On Global Warming -- Some Headlines From Around The World -- March 7, 2018

I do not recall ever seeing this much snow in 24 - 48 hours in Williston between 1953 and 1969:

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From Around The World

Little Ice Age on its way -- Romanian meteorologist -- and if you can't believe a Romanian meteorologist, whom can you trust?

Record cold winter for Australia -- "no doubt warmists will conflate this to 'an expected consequence of warming."

Heavy snow for New York, Vermont, Connecticut, Massachusetts, March 6, 2018 -- localized amounts up to 20 inches; snowfall rates of 1 to 2 inches per hour or greater -- the Kennedy clan is gobsmacked

Heavy snow -- and we're not talking cocaine -- shuts down California freeway.

Record snowfall in New York -- March 4, 2018.

Obama's fraudulent EPA exposed.

"The End of Snow?" -- NY Times, February 7, 2014 -- just four years ago.

Headline too long to post.

Everything -- Except The Equity Market -- Holding Steady; Great Update On NGL Production -- RBN Energy -- March 7, 2018 -- Campaigns Matter -- Hillary Said She Would Put A Lot Of Miners Out Of Work; Trump Said He Would Create Jobs

Chevron: backs 2018 production rise, eyes share buybacks.

Disclaimer: as I've said 3, 564 times on the blog -- this is not an investment site.

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Back to the Bakken

"Arctic" rigs:

$62.33→	3/7/2018	03/07/2017	03/07/2016	03/07/2015	03/07/2014
Active Rigs	60	44	35	114	191

RBN Energy: record crude and gas production leads to record NGL production at just the right time.

In recent weeks, both crude oil and natural gas production have breached all-time records. So it should come as no surprise the same thing happened to NGLs — production blasted to over 4.0 MMb/d in the fourth quarter of 2017, and by our estimates will move considerably higher this year. This is a particularly big deal for the ethane market, which has spent the last eight years waiting patiently for a wave of new Gulf Coast ethane-only petrochemical plants — a.k.a. “steam crackers” — to come online in 2018.

Well, here we are in 2018 and new demand from the crackers is finally kicking in. The good news for petchems is that all of the incremental NGL production means the supply of ethane available to the market is growing too, right on cue. What do these developments mean for future NGL production, demand and prices? Today, we begin a new blog series discussing our updated NGL market forecasts, starting with that NGL product whose market is going through the most changes: ethane. 

Poll: and with the RBN Energy story this is as good a time as any to close out the poll in which we asked whether crude oil production should take precedence over ND's self-imposed cap on flaring?

• Yes, forget about caps on flaring; push for maximum crude oil production: 13%
• Ease the caps on flaring now that the market is improving but long term keep the caps as goals: 42%
• No, hold the industry accountable: maintain the caps and minimize waivers: 45% 

FWIW, I would have wavered between the 2nd and 3rd choices, and probably would have gone with a coin flip.

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A Political Note

Good Riddance? Ya Think?

Campaigns matter: a reader pointed out --

Go back and listen to what they said in their campaigns ... Obama said he would KILL coal; Hillary said she would put a lot of miners out of work;  Trump said he would create/protect USA jobs.

Everything Holding Stable -- March 6, 2018

Statoil, room to run in the Bakken: from Reuters --

Statoil ASA, the Norwegian state-controlled oil producer, has plenty of growth opportunities left in North Dakota's Bakken shale formation, an executive said on Tuesday.

"We have quite a lot of running room" in North Dakota, Torgrim Reitan, head of Statoil's U.S. operations, said in an interview on the sidelines of CERAWeek in Houston, one of the world's largest gathering of energy executives.

Oil development has spiked in recent years in the Permian Basin of Texas and New Mexico. Concern has spread about a maturation of operations in North Dakota, the second-largest oil-producing U.S. state where Statoil is one of the largest producers.

The company does not see its North Dakota operations slowing down and it using new technologies and other process improvements to suck more oil from the Bakken, Reitan said.

Comment: based on what little I know about the Bakken, it appears the "big names" drilling in the Bakken have ten to fourteen years of drilling inventory left in the best of the Bakken; extending out to the better Bakken but not to the fringe, the "big names" drilling in North Dakota have fourteen to twenty years of drilling inventory. This doesn't necessarily mean anything for investors in equity, but it does mean something for those actually working in the field. The Bakken, like the Permian and the Eagle Ford, is a multi-generational play, regardless of what ....

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Daily Activity Report

"Arctic rigs":

$62.60→	3/6/2018	03/06/2017	03/06/2016	03/06/2015	03/06/2014
Active Rigs	60	44	35	114	191

Six new permits

• Operators: WPX (4); Petro-Hunt (2)
• Fields: South Fork (Dunn County); Charlson (McKenzie)
• Comments:

Three permits canceled:

• Lime Rock Resources: three Schneider permits in Dunn County

Five permits renewed:

• Whiting (3): two P Lynch permits and one Sue permit, all in Williams County
• EOG: one Hardscrabble permit in Williams County
• Thunderbird Resources: one Watson permit in McKenzie County

Two producing wells (DUCs) reported as completed:

• 32589, 1,412, Whiting, Koala 21-2TFHU, Poe, 4 sections, t2/18; cum -- (#19961, #20383, #23673, #23671, #23672)
• 32590, 978, Whiting, Koala 21-2TFH, Poe, t2/18; cum -- (#19961, #20383, #23673, #23671, #23672)

"Holy, Ricochet, Batman, Another Huge Build" -- March 6, 2018

Updates

Later, 8:24 p.m. Central Time: this is pretty cool. I noted the API inventories soon after the data was released earlier today. Now, several hours later, the story from Bloomberg -- "oil dips as data shows biggest US crude build since January, 2018." [Since January? LOL. This is only early March. Whatever.]

Crude slipped after industry data showed U.S. crude stockpiles rose by more than expected last week.

Futures in New York fell from the settlement Tuesday after the American Petroleum Institute was said to have reported crude inventories mounted higher by 5.66 million barrels last week. That would be the largest build since January if Energy Information Administration data confirms it on Wednesday in its release.

A Bloomberg survey showed crude storage in tanks and terminals across the country likely rose 3 million barrels last week.

 Original Post

API crude oil inventories:

• previously: a build of slightly less than one million bbls
• forecast for today's report: a build of 2.7 million bbls
• actual API estimate: a build of almost 6 million bbls -- 5.661 million bbls

I use EIA data to calculate re-balancing. That data will be released tomorrow at 10:30 am. Eastern Time.

WTI after the report: down about 25 cents, now at $62.33, which is fine.

And, yes, Robin really did utter "Holy, ricochet" in season 1 of the Batman television series.