U.S. NatGas Inventory Report, August 31, 2023

The Energy Information Administration released their weekly report today.

The Pacific Region is now slightly ahead of year ago numbers, but still below the 5 year average.

The South Central Region slipped below one year ago levels, but is still above 5 year average.

EIA.GOV, via SNL Energy

Nothing dramatic taking place, so steady as she goes, would be the best description, imho.

Review of July data and the August PCE Release

Some ups and some down in the latest release from the BEA. (red revised down, green revised up).

Chained dollar disposable income was revised down for April and June, with a negative print on July.

However, the chained dollar PCE was revised down for March and May, with upward revisions in April and June. 

It seems evident that savings AND debt are currently driving the economy. How long that can last is the big question.

Then there is the matter of PCE Excluding Food & Energy. If the target is 2%, then there is a way to go, given the forecast for August is at 4%. Years ago, when the PCE ex food and energy was failing to achieve even 2%, there was discussion of moving the target to 4%. 

That hasn't happened, so how can it be expected for the FED to ease off the interest rates? 

https://www.bea.gov/news/2023/personal-income-and-outlays-july-2023

We are now 28 months with the PCE ex food and energy above the 2% mark, and 17 months into the FED increasing rates. 10 months out, with the aforementioned halting its rise. 

The chart below indicates some problems still within the system. Last month had just one category in pink. 

We are at the end of August and its data will likely be similarly ugly. Let's hope for some relief in September. 

Quick Review of The GDP report 2Q-2023, 2nd estimate

The BEA released the 2nd estimate of 2Q-2023 GDP...

Real gross domestic product (GDP) increased at an annual rate of 2.1 percent in the second quarter of 2023 (table 1), according to the "second" estimate released by the Bureau of Economic Analysis. In the first quarter, real GDP increased 2.0 percent.

The GDP estimate released today is based on more complete source data than were available for the "advance" estimate issued last month. In the advance estimate, the increase in real GDP was 2.4 percent (refer to "Updates to GDP"). The updated estimates primarily reflected downward revisions to private inventory investment and nonresidential fixed investment that were partly offset by an upward revision to state and local government spending.

Here is a screenshot of the data page... 

Probably the most interesting thing is the GDI of +0.5%, which is the first positive, since 3rd Quarter of 2022.

Gasoline consumption per latest EIA data, August 30, 2023

Gasoline prices (per AAA) slipped from last report's $3.845, to $3.827. One year ago the price had fallen to $3.844, and was on its downward trajectory... into the early September lull, about $3.80. It rose a bit, then fell back to the December low.

It has edged upward, by 0.9¢ the past 3 days. The market is pointing toward a bit more upward movement, but that remains to be seen.

Consumption steadied at last week's pace, which is +2.3% above year ago level. In theory, consumption should begin to taper off in September. 

Crude and Petroleum Product Inventories - August 30 2023

Data per the EIA weekly report. 

Crude stocks slid another -10.6M barrels, from last week, and is -3.4% below the 5 year seasonal average. It should be noted the 5 year average includes the abnormal 2020 and 2021 number. Otherwise, the current inventory is nearly +0.4% above normal.

Distillates inventory rose +1.2M barrels; and Gasoline inventories slipped about -214K barrels. Distillates (-13%,-2.6%) and Gasoline (-3.2%, -1.4%) are both below 5 year and 3 year adjusted average inventories.

The SPR increased another 600K barrels this past week. This is the 4th straight week for increases, which are the first since January, 2021.

WTI is $81.74, compared to $78.96 (+3.5%), one week ago, and $89.03, one year ago (-8.2%).

Refinery output slipped on a weekly basis, and is slightly above above year ago levels

For anyone interested, the U.S. has exported 829.9M barrels of crude and petroleum products, more than imported, since March 1, 2022. It jumped +11.8M barrels this past week. (Distillates account for approximately 77%.

Overall, crude stocks remain somewhat decnt, compared to this time last year, with days supply at 25.4, to last year's 25.5 days.

Me complaining about a curbside restaurant/grocery order #1.

I have frequently complained about curbside service from various local restaurants, and continously express my concerns via their surveys... to no avail.

So, here goes.

Cracker Barrel once again stiffed me on items missing from my order. I always tip 20% on curbside orders. 

Granted, I could unpack everything in the car and make sure it is all there, but... I would think an extra few seconds in ensuring the order is complete before the server exits the store, would be appropriate. Afterall, that 20% tip is easier money than actually waiting on a table.

That's my stupid opinion.

This is what I got stiffed today...

I should point out that grocery stores seem to be joining the omissions, but still charging.

A look at my electricity bills over time

I do odd things, one of which is monitoring my electric bills. 

Obviously, my electricity usage is based on weather, which does change from time to time. While the graph is based on actual payments based on month bill is due, I utilize a rolling 12 month average, to gauge year to year changes.

Currently that 12 month rolling average is +3.1% above year ago levels. I suspect it might be lower, as I altered the thermostat settings in December of 2022. I adjusted the nighttime heating settings from 68°F to 72°F, which would increase the usage in winter time. Daytime heat settings remained at 72°F.

Cooling settings remain at 76°F daytime and 72°F for nighttime.

Currently, the 2023 average is below last year, but that is with 4 more months of bills, which are generally higher than current average. Also, it should be noted that year over year... or base effects come into play, which tends to hide the overall increases. 

So what might seem like good news, still carries quite a bite on the budget. The CPI-U suggests that the average consumer spends about 2.754% of their expenses on electricity... or about $150 per month. 

While my average is significantly short of that dollar amount, percentage wise... my electricity expenses are well north of 2.754%.

EU & UK NatGas Inventory Report, August 25, 2023

Data from the Aggregated Gas Storage Inventory report...

The storage continues to increase, and has surpassed same period of 2020.

Natural Gas prices moderated in both nearby and futures pricing, as the potential for a strike by Australian Unions at one LNG facility seemed to have abated. At least until another strike was threatened, which sent prices upward again... today.

While current prices in the EU and UK are below pricing of 2 years ago, they are still elevated compared to 2019 and 2020. Despite LNG exports, U.S. prices remain at 2019 and 2020 levels.

U.S. NatGas Inventory Report, August 24, 2023

The Energy Information Administration released their weekly report today.

The Pacific Region continued to gain inventory, although still below one year ago and 5 year average.

The South Central region shed inventory over the week, yet remains well above year ago and 5 year average.

EIA.GOV, via SNL Energy

Generally speaking, natural gas prices are significantly below one year ago levels, and more in line with pre-covid levels. 

Current price levels suggest consumer inflation in natgas as well as pass through products (electricity) will continue to moderate. These products represent about 3.6% of the average consumer basket.

Gasoline consumption per latest EIA data, August 23, 2023

Gasoline prices (per AAA) slipped from last report's $3.873, to $3.845. One year ago the price had fallen to $3.892, and was on its downward trajectory... into the early September lull, about $3.80. It rose a bit, then fell back to the December low.

Consumption increase +1.4% week over week, and is +2.9% above year ago numbers. (This is a four week moving average). 

The good news, is the price seems to be easing a bit. Hopefully, it becomes a trend.

If history tells us anything... the increased consumption should begin to wane in the next couple of weeks. Then, if nothing else snaps... a descent in pump prices might be achieved. 👍

Crude and Petroleum Product Inventories - August 23 2023

Data per the EIA weekly report. 

Crude stocks slid another -6.1M barrels, from last week, and is -2.5% below the 5 year seasonal average. It should be noted the 5 year average includes the abnormal 2020 and 2021 number. Otherwise, the current inventory is nearly +1.4% above normal.

Distillates inventory rose +945K barrels; and Gasoline inventories rose about +1.4M barrels. Distillates (-14.5%,-3.9%) and Gasoline (-3.7%, -1.9%) are both below 5 year and 3 year adjusted average inventories.

The SPR increased 600K barrels this past week. This is the 3rd straight week for increases, which are the first since January, 2021.

WTI is $78.96, compared to $79.26 (-0.4%), one week ago, and $94.40, one year ago (-16.4%).

Refinery output edged upward on a weekly basis, and is slightly above above year ago levels

For anyone interested, the U.S. has exported 818.1M barrels of crude and petroleum products, more than imported, since March 1, 2022. It jumped +10.5M barrels this past week. (Distillates account for approximately 73%.

Overall, crude stocks remain somewhat healthy, compared to this time last year, with days supply at 26.0, to last year's 25.9 days.

Oddly in mid March, certain factors were quoted as the reason for runup in Crude prices, into Mid April. In early July, the same factors were quoted and as a reason for runup in Crude prices... until 2 weeks ago.

It may well be, that some of those factors will come into play. Be wary of the track record, imho.

Comparison of Inflation in selected countries- August, 2023 Edition

With the United Kingdom, Canada and EUstats release of July data, I have updated my comparison graph...

Note, the USA(EU method) is directly from Eurostats. Once upon a time, the UK was also included. I guess somebody's nose got out of joint for some reason. 😈

In any case, there is some moderation with inflation in Europe and the UK, with the U.S. and Canada having a slight uptick... largely due to core inflation, but set to accelerate with energy prices now rising. Including in Europe and the UK.

Here is hoping for a mild winter, with no strikes and stable pricing going forward. 

Is that too much to ask for?

EU & UK NatGas Inventory Report, August 18, 2023

 Data from the Aggregated Gas Storage Inventory report...

Much is being made of the 90% achievement, 3 months early. Typically this would represent about 3 months of supply, if all sources were cut off. That will not happen, but winter expectations and potential Australian LNG strike has provided apprehension in the markets. That potential for less supply has sent the bidding upward.

Overall, the price of TTF NatGas is still below levels of 2 years ago -(13.2%). That was before the pipeline chicanery, blackmail, etc. 

U.S. NatGas Inventory Report, August 18, 2023

The Energy Information Administration released their weekly report yesterday.

The Pacific Region continues to be below year ago and 5 year averages, although significant gains from last week.

Price changes in California were mixed this week. The price at PG&E Citygate in Northern California fell 7 cents, down from $5.71/MMBtu last Wednesday to $5.64/MMBtu yesterday. The price at SoCal Citygate in Southern California increased $2.85 from $4.95/MMBtu last Wednesday to $7.80/MMBtu yesterday. El Paso Natural Gas Company reported maintenance on the North Mainline near Leupp, Arizona, beginning on Monday August 14. In addition, ongoing maintenance is occurring at the SoCalGas pipeline system. Prices in the West remain the highest in the country as above-average temperatures keep demand for cooling high and as the Pacific region remains the only region in the United States with below-average storage levels.

 

Henry Hub prices fell from last week, as well as on the futures market.

Gasoline consumption per latest EIA data, August 16, 2023

Gasoline prices (per AAA) rose from last report's $3.825, to $3.873. One year ago the price had fallen to $3.949, and was on its downward trajectory... into the early September lull, about $3.80. It rose a bit, then fell back to the December low.

Consumption slipped -0.3% week over week, and is +0.6% above year ago numbers. (This is a four week moving average). 

Having completely missed the pump price direction the past couple of weeks... I'll avoid any predictions for the this. Although my tried and true method has suddenly gone awry.

One thing is almost certain... The August CPI report will bring added political scrutiny to the price of gasoline. So pick your favorite bogeyman... the Ukraine War, Putin, price gouging by the oil industry, refineries, and the list goes on.

Crude and Petroleum Product Inventories - August 16 2023

Data per the EIA weekly report. 

Crude stocks slid -6.0M barrels, from last week, and is -2.3% below the 5 year seasonal average. It should be noted the 5 year average includes the abnormal 2020 and 2021 number. Otherwise, the current inventory is nearly +1.3% above normal.

Distillates inventory rose +296K barrels; and Gasoline inventories fell about -262K barrels. Distillates (-15.1%,-5.2%) and Gasoline (-5.0%, -2.6%) are both below 5 year and 3 year adjusted average inventories.

The SPR increased 600K barrels this past week. This follows last week's increase, which was the first real increase since early January, 2021.

WTI is $79.26, compared to $83.77 (-5.4%), one week ago, and $89.67, one year ago(-11.6%).

Refinery output edged upward on a weekly basis, and is slightly above above year ago levels

For anyone interested, the U.S. has exported 807.6M barrels of crude and petroleum products, more than imported, since March 1, 2022. It jumped +12.3M barrels this past week.

Overall, crude stocks remain somewhat healthy, compared to this time last year, with days supply at 26.5, to last year's 26.2 days.

Despite previous weeks concern about production cuts, it seems that China's lack of anticipated rebound... is becoming the dominant issue.

At least in the current news cycle.

8-15-23, Advance Retail Sales Report for July

Advance Monthly Sales for Retail and Food Services, July 2023. 

Advance estimates of U.S. retail and food services sales for July 2023, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $696.4 billion, up 0.7 percent (±0.5 percent) from the previous month, and up 3.2 percent (±0.7 percent) above July 2022. Total sales for the May 2023 through July 2023 period were up 2.3 percent (±0.4 percent) from the same period a year ago. The May 2023 to June 2023 percent change was revised from up 0.2 percent (±0.5 percent)* to up 0.3 percent (±0.2 percent).

Retail trade sales were up 0.6 percent (±0.5 percent) from June 2023, and up 2.0 percent (±0.5 percent) above last year. Nonstore retailers were up 10.3 percent (±1.6 percent) from last year, while food services and drinking places were up 11.9 percent (±2.3 percent) from July 2022.

The "but not for price changes, means not adjusted for inflation... 

While improved over last month by 0.5% when adjusted for inflation... year to year is flat.

In a previous column, I made mention of the Census Bureau's propensity to revise downward previous month's data to improve current month results. We are in the second month of previous month's data being revised upward... which is good news. May that become a trend going forward.

Non store retailers, continues to lead the pack, with Furniture and Electronics turning negative from last month. Clothing edged up from last month, with Food Services and drinking places accelerating.

What really stands out is the EX gasoline category, which rose 5.8% year over year, which is better than the CPI EX gasoline of 4.3%.

Room for optimism!

Natural Gas Inventory Report, August 11, 2023

The Energy Information Administration released their weekly report yesterday.

The Pacific Region continues to be below year ago and 5 year levels, but is slowly gaining.

Prices increased in West Coast markets, still the highest priced markets in the United States, except in Southern California where a large maintenance event concluded. The price at Sumas on the Canada-Washington border rose 37 cents from $3.72/MMBtu last Wednesday to $4.09/MMBtu yesterday, and the price at PG&E Citygate in Northern California rose 54 cents, up from $5.17/MMBtu last Wednesday to $5.71/MMBtu yesterday. 

 Select EU and UK storage...

Inventories continue to improve across the EU and UK. (100% inventory capacity is approximately a 90 day supply.)

Dutch and UK futures, surged 6% and 7% respectively over last week. February, 2024 futures, surged nearly 22% from last week.

Henry Hub futures surged 7% almost across the board.

The upward pressure stems from labor action in Australia, increased LNG demand in Asia, as well as a Norwegian pipeline tapering down to closure in early fall. The labor action had been somewhat anticipated, and certainly the latter two... were on tap. Or as Rumsfeld might have said... the labor action was a known unknown, and the latter were known knowns. 

So something else might be shaking the market.

Producer Price Index August 2023 release

The BLS has released the July Producer Price Index Report.  (historical releases) 

The Producer Price Index for final demand increased 0.3 percent in July, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. Final demand prices were unchanged in June and declined 0.3 percent in May. (See table A.) On an unadjusted basis, the index for final demand advanced 0.8 percent for the 12 months ended in July. 

In July, the increase in final demand prices was led by a 0.5-percent rise in the index for final demand services. Prices for final demand goods edged up 0.1 percent.

The rate of increases has somewhat slowed and selected areas are now trending downward. The PPI since start of Covid has risen 17.3%, compared to the CPI rise of 19.2%. (That is just two data points and should not be construed as any indication of some guaranteed future changes.)

Certainly improvement, but overall a "D" rating as for inflation outlook, imho. August would appear to have a further inflation uptick, from July's reports. 

BLS releases latest Real Earnings... August 10, 2023

The BLS has released the latest Real Earnings Report. 

Real average hourly earnings for all employees increased 0.3 percent from June to July, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. This result stems from an increase of 0.4  percent in average hourly earnings combined with an increase of 0.2 percent in the Consumer Price Index for All Urban Consumers (CPI-U).

Real average weekly earnings were essentially unchanged over the month due to the change in real  average hourly earnings combined with a 0.3-percent decrease in the average workweek. 

The following graphs include data back to pre-covid. This is essential information, as Covid sent many home from the workplace, and many did not have the option of "zoom" etc. The result being many lower income wage earners got left out of the data, which distorted the information results.

As employment is near pre covid numbers, the past "few" months, compared to February, 2022, becomes a more accurate picture, imho. Additionally, these numbers are inflation adjusted, so a real increase has taken place. Not much, but that has been the story for quite a number of years.

The rundown...

While earnings have improved and employment appears solid, it does not mean storm clouds aren't gathering. Whether the glass is half full or half empty... TBD.

CPI Latest DATA results, August 10, 2023

The BLS report was released this morning and it was at consensus estimates. (historical releases)

The Consumer Price Index for All Urban Consumers (CPI-U) rose 0.2 percent in July on a seasonally adjusted basis, the same increase as in June, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 3.2 percent before seasonal adjustment.

The index for shelter was by far the largest contributor to the monthly all items increase, accounting for over 90 percent of the increase, with the index for motor vehicle insurance also contributing. The food index increased 0.2 percent in July after increasing 0.1 percent the previous month. The index for food at home increased 0.3 percent over the month while the index for food away from home rose 0.2 percent in July. The energy index rose 0.1 percent in July as the major energy component indexes were mixed.

The rates on the graph, averaged 3.5% during that 75 year period. The past ten years averaged 2.7%, and the 10 year pre-covid rate was 1.7%. The 21st century average is 2.5%. Pick your normal.

While last month's 3.0% and this month's 3.2% are below the 75 year average, not exactly better than either of the 10 year marks, nor the 21st century average.

The past 28 months have seen food at home risen 20.4% (8.74% annualized), and the overall CPI up... 16.9% (7.24% annualized).

That is something very fresh in the minds of many Americans.

In the absolutely to early to project something, but I can't help myself category... the current outlook for C.O.L.A.

So far this month...

Time for some more graphs...

It should be noted, the July, 22 ~ December, 22 period was nearly flat. Since then, the rate of inflation has had an upward trajectory.

My personal CPI rate is better than expected. but still not pleasing to me. 

There seems to be some euphoria over today's report, which seems to be based on inflation matching consensus expectations, although a bit higher than next month.

Which brings me to expectations for the current month. Nearly everything I've read indicates a higher print for next month. I haven't read any consensus expectations, but the range is much higher. With energy prices jumping upward, as well as food prices... core will need to slow down to bring the August numbers within range of July, imho.

Gasoline consumption per latest EIA data, August 09, 2023

Gasoline prices (per AAA) rose from last report's $3.803, to $3.825. One year ago the price had fallen to $4.033, and was on its downward trajectory... into the early September lull, about $3.80. It rose a bit, then fell back to the December low.

Consumption slipped -0.3% week over week, and is +1.2% above year ago numbers. (This is a four week moving average). 

The import/export surplus of gasoline since last March 1st 2022, rose to +106.2M barrels. That is an +1.8M barrel increase over the week.

I was again overly optimistic, with a projection of -4¢~ -11¢ for the week, and the result a 2.2¢ increase.

My crystal ball was wrong, so could be wrong this time as well. Pump prices really should peak and drift -4¢ to -7¢ lower.

However, the crude and gasoline markets seem to be in a bit of hysteria at the moment. How much fear is warranted and how much is hype? I dunno.

One thing is for certain, the CPI energy index is popping for August, coupled with projected food increases and core remaining hefty. The CPI imprint for tomorrow is projected to rise above last month's annual increase... and August looks like a hard tick upward, at this point. 

Crude and Petroleum Product Inventories - August 09 2023

 Data per the EIA weekly report. 

Crude stocks rose +5.8M barrels, from last week, and is -1.9% from the 5 year seasonal average. It should be noted the 5 year average includes the abnormal 2020 and 2021 number. Otherwise, the current inventory is nearly +1.4% above normal.

Distillates inventory slid -1.7M barrels; and Gasoline inventories fell about -2.7M barrels. Distillates (-15.2%,-4.4%) and Gasoline (-5.5%, -3.2%) are both below 5 year and 3 year adjusted average inventories.

The SPR increased 995K barrels this past week. The first real increase since early January, 2021.

WTI is $83.77, compared to $79.45 (+5.4%), one week ago, and $90.47, one year ago(-7.4%).

Refinery output remained steady on a weekly basis, and is slightly above above year ago levels

For anyone interested, the U.S. has exported 795.2M barrels of crude and petroleum products, more than imported, since March 1, 2022. It jumped 2.0M barrels this past week.

Overall, crude stocks remain somewhat healthy, compared to this time last year, with days supply at 26.6, to last year's 26.3 days.

One noticeable shift in this week's report, was the rather dramatic drop... in crude exports. This may have just been a timing issue. That would account for about half of the crude inventory increase, as well as another near 1M barrel increase in SPR.

If it is a timing issue, then the expectation would be for a drop in crude inventory for next week, which may explain the rapid rise in WTI crude price today.

For some reason, there is concern about the future of crude inventories, and may be warranted, but historically... the inventory is well above average, both numerically and in days supply.

Puzzling!