Refinery Operating Capacitiy -- An Observation -- June 13, 2018 -- Another Most Interesting Graphic

Earlier I posted another most interesting graphic.

Now, this graphic, again, from John Kemp:

Distillate Fuel -- An Observation -- June 13, 2018 -- Most Extraordinary Graphic

Just moments ago I posted this:

Weekly petroleum report, link here:

• down a lot more than expected
• down 4.14 million bbls
• now at 432.4 million bbls
• WTI immediately after report -- up 25 cents/bbl -- now at $66.54
• refinery operating capacity way up: 95.7% -- highest I've seen in a long time
• gasoline production crept up slightly; I use "10 million bbls/day" as the benchmark; most recent data, up to 10.5 million bbls/day
• distillate fuel production crept up slightly; I use "5 million bbls/day" as the benchmark; most recent data, up to 5.1 million bbls/day

I thought that was a "positive" report regarding distillate fuel -- production actually crept up slightly, and was very slightly above my "benchmark."

But then this. This is an incredible graph. A huge thanks to John Kemp for spotting this:

I have opined many times that if I had but one metric to follow to judge the health of the US economy, it would be amount of gasoline consumed.

Now, without question, I would argue that if one had but one metric to follow the industrial activity of the US, the one metric to use: distillate fuel consumed. 

The Bakken is booming again. The Permian is on fire. And I often forget to mention it bu the Eagle Ford is doing very, very well.

In addition, all the new petrochemical activity and new construction going up along the Texas - Louisiana gulf coast.

This "stuff" all uses a lot of diesel fuel.

From the EIA:

And look at this. John Kemp predicted this seven months ago:

Can anyone say, "synchronized global economy"?

I wrote that last line before I read the John Kemp article. Here are the last three paragraphs of that article:

While some distillate fuel oil is still used for heating, most is used in the high-powered engines used to move freight and industrial machinery so demand is closely linked to the business cycle and trade.

With nearly all regions of the global economy experiencing a synchronized economic expansion and world trade volumes are growing at the fastest rate for six years, distillate demand is growing rapidly.

The global economic expansion and trade upturn are expected to continue boosting demand even further in 2018/19 unless there is a major macroeconomic, financial or trade shock.

Crude Oil Inventories Down More Than Expected -- June 13, 2018

NASDAQ: hits another all-time high. Whoo-hoo!

Disclaimer: this is not an investment site. Do not make any investment, financial, job, travel, or relationship decisions based on what you read here or think you may have read here.

Busy day in Bismarck? Data for wells coming off confidential list today not yet posted.

Weekly petroleum report, link here:

• down a lot more than expected
• down 4.14 million bbls
• now at 432.4 million bbls
• WTI immediately after report -- up 25 cents/bbl -- now at $66.54
• refinery operating capacity way up: 95.7% -- highest I've seen in a long time
• gasoline production crept up slightly; I use "10 million bbls/day" as the benchmark; most recent data, up to 10.5 million bbls/day
• distillate fuel production crept up slightly; I use "5 million bbls/day" as the benchmark; most recent data, up to 5.1 million bbls/day

Netflix: lots of talk about Netflix this morning on Fox Business News --

• Netflix has unique ability to stream content to individuals 
• on a personal level: our daughter / son-in-law watch almost no "television" 
• they subscribe to Netflix and a few other such outlets
• Sophia only watches Netflix
• when I come over to her house, I pick up the remote
• press on the "Netflix" button
• click on "Sophia" on the screen
• up pops all the channels, series, and shows that are targeted specifically for Sophia
• if I click on "Arianna," her older sister, a whole new set-up pops up
• I then scroll through the channels, series, or shows, and Sophia points out what she wants to watch
• and no ads
• Netflix is really quite remarkable
• "The Next Big Thing" began with Netflix many, many years ago

Sticky graphs: I post a lot of graphics on the blog, but recently this is the graphic that sticks in my mind -- this is a really, really remarkable graph and explains why Trump is turning away from the G7 and shifting to the east (China, Korea, Japan, Asia):

The Market And Energy Page, T+13 -- June 13, 2018

Disclaimer: this is not an investment site. Do not make any investment, financial, travel, job, or relationship decisions based on what you read here or what you think you may have read here.

EW to hit 52-week high, and also appears to be an all-time high:

Making North America great again: it should be remembered that President Obama failed to get the World Cup to the US for both 2018 and 2022 despite a personal and compelling appeal. But, apparently ... well ... best left unsaid ...

Some Relief For The Permian Natural Gas Glut? Waha To Mexico -- June 13, 2018

Well, that was easy:

Floating storage of US shale oil "swamps" Europe -- from Reuters -- (estimates for the most part) --

• The boom in U.S. shale shipments has outstripped OPEC’s production cuts and pushed millions of barrels into European waters, where more crude is being stored on ships than at any time in the last 18 months.
• At a monthly average in May of 12.9 million barrels, or 26 percent of total global floating storage, Europe had more oil in floating storage than the Asia-Pacific region at 9.7 million.
• In March-April, Europe’s share was 10 percent versus 40 percent in Asia-Pacific.
• The monthly average share of oil in floating storage located in European – including the Mediterranean – in May outstripped volumes floating in Asia-Pacific for the first time since at least the beginning of 2015.

Global oil demand to remain strong in 2019 -- IEA -- link at WSJ.

• report says demand will grow by 1.4 million bopd
• this is IEA's first forecast for 2019
• demand for 2019 will be on par with this year
• a significant part of that growth will be driven by rising demand for petrochemicals  

US crude oil inventories, weekly data: one link is here --

• API report yesterday: an insignificant draw of 730,000 bbls
• expectation by analysts: a draw of 2.744 million bbls
• API: surprise build of gasoline inventories -- a build of 2.33 million bbls
• analysts had expected a build of only 443,000 bbls
• that's why your neighborhood service station dropped gasoline prices overnight (LOL)
• EIA' s weekly petroleum report will be released later this morning

US crude oil production (same link as above):

• US weekly production sets new record, I believe, up to 10.8 million bopd
• Saudi Arabia increases production to 10 million bopd
• Russia increased oil production to 11.1 million bopd

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Back to the Bakken

 
Active rigs:

$66.05	6/13/2018	06/13/2017	06/13/2016	06/13/2015	06/13/2014
Active Rigs	62	56	28	75	185

RBN Energy: the El Encino-to-Topolobamo pipeline nears completion, and what it means for Waha.

Mexico has been slowly increasing import volumes of natural gas from the U.S., utilizing spare capacity in the newest pipelines south of the border that access supply from the Permian Basin’s Waha Hub. The recent increases have been muted somewhat by delays in completing other infrastructure inside of Mexico, but one of those big delays is about to be resolved. TransCanada’s long-awaited El Encino-Topolobampo Pipeline is finally nearing completion, and once it’s online there may be a surprisingly big gain in gas export volumes to Mexico. As most of this gas will be supplied directly from Waha, Mexico’s impact on Permian gas balances is likely to jump materially in the weeks ahead. Today, we examine the latest development in Mexico’s natural gas pipeline buildout and its effects north of the border.