Crude and Petroleum Product Inventories - June 07 2023

Data per the EIA weekly report.

Crude stocks fell- 452K barrels, from last week, and remains down -3.3% 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 +1.2% above normal.

Distillates inventory surged +5.1M barresl; and Gasoline inventories climbed +2.7M barrels barrels. The SPR fell another -1.867M barrels.

WTI is $72.56, compared to $70.02, one week ago, and $114.54, one year ago. (It began the big slide from there).

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 688.7M barrels of crude and petroleum products, more than imported, since March 1, 2022. There was only a slight bump this week. 

Overall, crude stocks remain quite healthy, despite the major drop and compared to this time last year, with days supply at 28.3, compared to last year's 25.3 days.

 

Natural Gas Inventory Report, June 02, 2023

The Energy Information Administration released their weekly report on Friday.

The national inventory stock remains above 5 year average and is keeping pace with seasonal movements. As usual, the Pacific region is lagging, but showing significant gains each week.

Select regional spot prices: Natural gas spot prices fell at most locations this report week (Wednesday, May 24, to Wednesday, May 31), except for prices in the Northeast. Price changes at major pricing hubs this report week ranged from a decrease of 29 cents/MMBtu at the Waha Hub in western Texas to an increase of $3.30/MMBtu at the Algonquin Citygate in the Northeast.

Select inventories of EU and UK...

Prices continue to fall on the UK and EU markets. The UK spread of 12 month futures is annually at £1,441.34 ~ £2,174.50, with OFGEM setting the cap at £2,074. That cap is consistent with NatGas prices of £94.51 per Therm or $11.76 per MMbtu. November futures rise above the cap.

The lowering of the (annual) energy cap from £2,500 to £2,074 is certainly a great relief, however it was only 2 years ago, it was something like £1,200 annually for the average household. The monthly energy charges have fallen substantially and is reflected in the U.K. CPI. 

gas provided a downward contribution of 0.75 percentage points to the monthly change in CPIH

electricity provided a downward contribution of 0.67 percentage points to the monthly change in CPIH.

 

Energy costs have abated, but elsewhere is very troubling, in my humble opinion.  

Gasoline consumption per latest EIA data, June 01, 2023

Gasoline prices (per AAA) remained flat from last report at $3.574 One year ago the price had ballooned to $4.671

Consumption increased +1.3% from last week, and stands 3.3% above year ago numbers. (This is a four week moving average).

The import/export surplus of gasoline since last March 1st 2022, stands at +99.7M 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 +118K daily. 

Where will pump prices be next week? The crack spread is easing and the range appears biased to the downside. My estimate last week was +6.6¢ and was flat, so this week, I am guessing a downside of about -4.7¢. Here's hoping I continue to overestimate the pump price.

Crude and Petroleum Product Inventories - June 01 2023

Data per the EIA weekly report.

Crude stocks rose +4.9M barrels, from last week, and remains down -3.0% 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 +1.6% above normal.

Distillates increased +985K; and Gasoline inventories slid -207K barrels. The SPR fell another -2.5M barrels.

WTI is $70.02, compared to $74.19, one week ago, and $112.72, 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 687.9M barrels of crude and petroleum products, more than imported, since March 1, 2022. 

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 25.9 days.

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.