Review of PCE, GDP, etc., for end of May, 2023

 

There was a "surprise", as the PCE EX FOOD and ENERGY was higher than forecast. I am not sure why it was a surprise, as the forecast I saw... was for 4.7%. 

Unfortunately, the expectations are a bit higher for April's PCE report. PCE at 4.5 and core at 4.7%. 

Perhaps the surprise was no downward revisions.

Personal consumption and outlays...

I would think the 0.0% rise in chained (2012) dollars for Disposable personal income, compared to PCE of same being at 0.5% would raise some eyebrows. But it is a credit driven economy, so what the heck. Going deeper in debt is the national pastime. 

Even the GDP was touted as going up from advance estimate of 1.1% to 1.4%, as being stellar. While ignoring the GDI for 4th quarter 2022, was revised sharply downward from -1.1% to -3.3%. The GDI for 1st quarter, 2023 came in at a -2.3% mark. 

In any case DPI now stands at +2.6% above the 1st Quarter, 2020 level. Presented without further editorial comment.

Natural Gas Inventory Report, May 27, 2023

The Energy Information Administration released their weekly report on Thursday.

Nationally, inventories are well above the 5 year average, although still well below in the Pacific region. substantial gains have taken place over the past few weeks.

Prices in all West Coast markets declined yesterday from last Wednesday. The price at PG&E Citygate in Northern California fell 95 cents, down from $4.13/MMBtu last Wednesday to $3.18/MMBtu yesterday. The price at SoCal Citygate in Southern California decreased 33 cents from $2.58/MMBtu last Wednesday to $2.25/MMBtu yesterday. The price at Sumas on the Canada-Washington border fell 21 cents from $1.83/MMBtu last Wednesday to $1.62/MMBtu yesterday. Natural gas consumption in the Western region decreased by 1% (0.1 Bcf/d), which was led by a 4% (0.1 Bcf/d) decrease in consumption in the electric power sector. In Northern California, PG&E’s total gas in storage was 12.6 billion cubic feet (Bcf) as of May 23, up from 5.8 Bcf on May 1.

Select inventories of EU and UK...

Prices continue to fall on the UK and EU markets. The UK spread of futures is annually at £1,453.60 ~ £2,191.06, with OFGEM setting the cap at £2,074. That cap is consistent with NatGas prices through October, with an added 3.7% cushion.  

Gasoline consumption per latest EIA data, May 24, 2023

Gasoline prices (per AAA) edged up this week, from $3.532 to $3.561. One year ago the price had ballooned to $4.598

Consumption increased +0.2% from last week, and stands 1.5% above year ago numbers. (This is a four week moving average).

The import/export surplus of gasoline since last March 1st 2022, stands at +98.9M barrels. The import/export numbers have really not changed that much over the past few weeks and this past week showed more imports than exports, by 300K. 

Where will pump prices be next week? The crack spread is starting to edge up and the range appears biased to the upside. My estimate would be another 6.6¢ on top of current. 

Here's hoping I am wrong and prices will go down. Still, the likelihood of $4 national average is becoming less likely. 

Crude and Petroleum Product Inventories - May 24 2023

Crude stocks dropped rather dramatically -12.4M barrels, from last week, and remains down -4.0% 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 +1.0% above normal.

Distillates slid -500K; and Gasoline inventories slid -2.0M barrels. The SPR fell another -1.6M barrels. 

WTI is rising at $74.19, compared to $72.74, one week ago, and $106.82, one year ago. 

Refinery output continues to edge up on a weekly basis, as well as above year ago levels.

For anyone interested, the U.S. has exported 674.8M barrels of crude and petroleum products, more than imported, since March 1, 2022. For reference, since September 21, 2018, the import/export situation is at balance. 

Overall, crude stocks remain quite healthy, despite the major drop and compared to this time last year, with days supply at 28.7, compared to last year's 26.5 days.

Natural Gas Inventory Report, May 19, 2023

The Energy Information Administration released their weekly report on Thursday.

Nationally, inventories are well above the 5 year average, although still well below in the Pacific region. substantial gains have taken place over the past few weeks, having increased 27% in the past two weeks.

Pricing in the Pacific region did increase, but still remains within reach of other regions... which continue to be on the low side.

EU and UK continue to fare well, regarding inventories and remain well above both last year and seasonal 5 year averages.

While pricing in Europe has fallen, it continues to be extremely high, compared to pre-covid and pre-invasion.

An example would be the U.K., where the price range is currently £1,509~£2,264. I compare that to the extreme predictions of £3,600~£5,400 from about 21 months ago, and the price cap rollout of £2,500.

The good news is the £2,500 cap will stay into June. I would think the cap could be lowered, based on current market pricing, but that is just my silly opinion. It's not like there is a large storage of higher priced natgas to work through, for th UK.

Gasoline consumption per latest EIA data, May 17, 2023

Gasoline prices were (per AAA) were flat this week, from $3.531 to $3.532. So okay... one tenth of  once cent more. A year ago, the price had ballooned to $4.452. 

Consumption increased +0.4% from last week, and stands 1.6% above year ago numbers. (This is a four week moving average).

The import/export surplus of gasoline since last March 1st 2022, stands at +99.2M barrels. The import/export numbers have really not changed that much over the past few weeks and this past week showed more exports than imports, by 600K. 

Where will pump prices be next week? There does not appear much change in pump prices, as the range might be in the ± 5¢ range.

Crude and Petroleum Product Inventories - May 17 2023

Today's EIA.gov report. 

Crude stocks jumped +5.0M barrels, from last week, and remains down -1.7% 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 +2.8% above normal.

Distillates held steady; and Gasoline inventories slid -1.3M barrels. The SPR fell another -2.4M barrels. 

WTI is steady at $72.74, compared to $72.92, one week ago, and $106.76, one year ago. 

Refinery output continues to edge up on a weekly basis, as well as above year ago levels.

For anyone interested, the U.S. has exported 659.1M barrels of crude and petroleum products, more than imported, since March 1, 2022.

Overall, crude stocks remain quite healthy, compared to this time last year, with days supply at 29.5, compared to last year's 26.8 days.

Distillates remain steady to last year.