WTI crude oil futures initially pared back on this morning’s losses on an initial read on the EIA’s crude oil inventory report which showed that crude stocks fell more than expected and also surpassed the draw that the API reported last night. However, oil futures subsequently fell back below pre-report levels with the concern of growing crude-product inventories as both distillate and gasoline stocks rose more than expected despite refiners hiking output less than what was forecasted.
*Important Disclaimer: Beginning ON 10/13/16 the EIA will no longer include crude oil lease stocks in U.S. total commercial crude oil inventory data. Crude oil lease stocks refer to oil (currently about 31 million barrels) that is stored in tanks at sites across the United States where producers are drilling on leased land. Lease stocks are not yet available for commercial use, and in many cases, operators do not count them as production until the oil is transferred off the lease.
WEEKLY HIGHLIGHTS:
OPEC will accept a natural decline from non-OPEC.
A natural decline makes it impossible to cheat, making these production cuts very reliable.
Analysts say Russia is playing tricks on the market as its current production is more around 10.8 million b/d vs. the self-reported 11.2 million b/d.
Analysts expect the non-OPEC deal to go through and oil markets will rally on the back of the news.
See previous crude oil reports ( here).
SUMMARY:
U.S. crude oil refinery inputs averaged over 16.4 million barrels per day during the week ending December 2, 2016, 134,000 barrels per day more than the previous week’s average. Refineries operated at 90.4% of their operable capacity last week. Gasoline production decreased last week, averaging over 9.9 million barrels per day. Distillate fuel production decreased last week, averaging 5.1 million barrels per day.
U.S. crude oil imports averaged 8.3 million barrels per day last week, up by 755,000 barrels per day from the previous week. Over the last four weeks, crude oil imports averaged about 8.0 million barrels per day, 5.9% above the same four-week period last year. Total motor gasoline imports (including both finished gasoline and gasoline blending components) last week averaged 652,000 barrels per day. Distillate fuel imports averaged 106,000 barrels per day last week.
U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) decreased by 2.4 million barrels from the previous week. At 485.8 million barrels, U.S. crude oil inventories are at upper limit of the average range for this time of year. Total motor gasoline inventories increased by 3.4 million barrels last week, and are well above the upper limit of the average range. Both Finished gasoline inventories and blending components inventories increased last week. Distillate fuel inventories increased by 2.5 million barrels last week and are above the upper limit of the average range for this time of year. Propane/propylene inventories fell 1.5 million barrels last week but are near the upper limit of the average range. Total commercial petroleum inventories increased by 1.4 million barrels last week.
Total products supplied over the last four-week period averaged about 19.6 million barrels per day, down by 1.0% from the same period last year. Over the last four weeks, motor gasoline product supplied averaged about 9.1 million barrels per day, down by 1.2% from the same period last year. Distillate fuel product supplied averaged 3.9 million barrels per day over the last four weeks, up by 5.7% from the same period last year. Jet fuel product supplied is up 3.6% compared to the same four-week period last year.
Complete report ( here )
