Resilience

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Peak Oil Notes - Apr 24

Published by ASPO-USA on 2014-04-24
Original article: http://peak-oil.org/ by Tom Whipple

It has been an active week for the oil and gas markets as the Ukrainian situation worsens and US crude inventories rose to all-time highs. At the close Wednesday, New York oil was trading at $101.44 a barrel and London was at $109.11 -- pushing the Brent premium back up to $7.67 a barrel.  The weekly US stocks report showed the crude inventory climbing by 3.5 million barrels to an 83-year high of 398 million. Crude continued to drain from Cushing, Okla. to the Gulf coast increasing stocks there to 210 million barrels, the most since record keeping began 34 years ago. Stocks at Cushing fell by 788,000 barrels to the lowest level since 2009.  Some analysts are saying that there is so little storage capacity left along the Gulf coast that imports may have to be slowed in coming weeks.
 
The EIA reports that US crude production increased last week by 59,000 b/d to 8.36 million, the highest since 1988; however, some are beginning to note the discrepancies between what Texas and North Dakota report as their production and the higher numbers given out by the EIA.
 
US refinery utilization increased by more than expected to 91.0 percent of capacity and reached 94.1 percent along the gulf coast where refineries are feeding a strong export demand for gasoline and distillates. US gasoline stocks fell by 300,000 gallons last week and US retail prices continue to climb, reaching a national average of $3.68 for regular this week; in several large California cities, gasoline is pushing $4.30. The EIA says prices will stabilize soon and will average $3.57 this summer; however, the AAA and others are talking about gasoline going to $3.75 or higher during the driving season.
 
With forecasters predicting that temperatures in northern US will be below normal during the next week or so, concerns are rising about the slow progress being made in rebuilding US natural gas stocks in time for next winter. Natural gas futures closed Wednesday at $4.77 per million BTUs. While some analysts are worried that    the demand for heating gas will continue on into May, others note that there will be lower demand for air conditioning and thus less natural gas consumption in the south.
 
Overseas, the worsening Ukrainian situation continues to support European oil prices, with Russia and the West exchanging blame and threats of sanctions, but both are staying away from talking about Moscow’s oil and gas exports. China reported that its manufacturing fell again in April for the fourth straight month, leading to concerns as to where Beijing’s economy is going this year.
 
Libya’s oil production remains at 220,000 b/d with little progress being made on getting more than one small oil port open thus far – negotiations continue, however.


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Source URL: http://www.resilience.org/stories/2014-04-24/peak-oil-notes-apr-24