This Week in Petroleum 1-16-08
Posted by Robert Rapier on January 16, 2008 - 7:17pm
With all of the traveling, and then trying to catch up after the holidays, I haven't had time to do a proper TWIP. Thanks to Nate for looking after it during my vacation. Anyway, mostly what we saw for the past month were crude draws, and gasoline inventories climbing back up and getting in pretty good shape prior to spring turnaround season. Part of the draw down in crude was tax-related. Many countries, including the U.S., tax crude inventories at year end. So, there is a bit of a balancing act as refiners try to draw down inventories while still maintaining enough on hand to weather any supply disruptions.
This week saw a large gain across the complex, and crude prices are falling as a result.
DOE: Actuals
Crude oil: Up 4.3 million barrels
Motor gas: Up 2.2 million barrels
Distillates: Up 1.2 million barrels
Complex Up 7.6 million barrels*
* Total does not add due to rounding
API: Actuals
Crude oil: Up 2.4 million barrels
Motor gas: Up 1.6 million barrels
Distillates: Down 3.3 million barrels
Complex: Up 0.7 million barrels
The Bloomberg survey of analyst’s expectations
Crude oil: Up 1.3 million barrels
Motor gas: Up 2.3 million barrels
Distillates: Up 1.6 million barrels
Complex: Up 5.1 million barrels*
* Total does not add due to rounding
Summary of Weekly Petroleum Data for the Week Ending January 11, 2008
Some highlights:
U.S. crude oil refinery inputs averaged nearly 15.0 million barrels per day during the week ending January 11, down 760,000 barrels per day from the previous week's average. Refineries operated at 87.1 percent of their operable capacity last week.
U.S. crude oil imports averaged 10.4 million barrels per day last week, up 583,000 barrels per day from the previous week. Over the last four weeks, crude oil imports have averaged 10.0 million barrels per day, or 219,000 barrels per day more than averaged over the same four-week period last year.
U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) rose by 4.3 million barrels compared to the previous week. At 287.1 million barrels, U.S. crude oil inventories are in the lower half of the average range for this time of year. Total motor gasoline inventories increased by 2.2 million barrels last week, and are near the upper limit of the average range. Total commercial petroleum inventories increased by 3.6 million barrels last week, and are in the middle of the average range for this time of year.
CNN's take:
Oil below $90 on surprise supply increase
NEW YORK (CNNMoney.com) -- Oil prices fell sharply Wednesday after the government reported a surprise increase in crude supplies.
U.S. light crude for February delivery fell $2.20 to $89.62 a barrel on the New York Mercantile Exchange. Oil had traded down $1.21 prior to the report's release.
In its weekly inventory report, the U.S. Energy Information Administration said crude stocks grew by 4.3 million barrels last week, after posting declines for eight weeks in a row. Analysts were looking for a drop of 300,000 barrels according to a Dow Jones poll.
"The market looked at the report as bearish, given the increase in crude stocks," said Andrew Lebow, a broker at MF Global in New York.
My take: As we move into refinery turnaround season from late February through April, we should see crude inventories start to build, and gasoline inventories should get pulled down. That should start a run toward $4 gasoline.
Sorry for being so brief with this. No chance for me to respond to comments right now. Hopefully I will regain some of my time soon.
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One thing that may affect changes this week is footnote at the end of the Weekly Status Report says:
I have not tried to research whether one can determine how much impact this re-benchmarking might have. I am supposed to be working on another post. API data for the week are fairly different, and the API mentioned the re-benchmarking as a likely contributor to the difference.
API: Actuals
Crude oil: Up 2.4 million barrels
Motor gas: Up 1.6 million barrels
Distillates: Down 3.3 million barrels
Complex: Up 0.7 million barrels
Robert, Gail et al, thanks for this report. WTF does it all mean? For the benefit of all Toders here's email correspondence from behind the veil:
Any the wiser? If the DOE numbers reflect a shift in last week's benchmark then I'd have to bet on the API. Its interesting to see the uncertainty bound up in these weekly data - so the only solution is to look at a chart and follow the trend.
what does rebenchmarking mean?
As I understand it...the weekly numbers are basically just a guess. They call people up and ask "How much do you have?"
Geko45 at Peakoil.com explained it this way:
Mr. Rapier: Nice to have your comments. It helps to have an industry insider who knows which supply changes are cyclical and expected, and which are otherwise.
I think it's interesting to compare this week's numbers to the same week last year.
U.S. production is down 300,000 barrels a day compared to last year's (5.013 vs. 5.317). (How much is Atlantis contributing at this point?) And crude imports for the week, though up, were almost 700,000 barrels a day below last year's number for the past week (10.389 vs. 11.057).
We don't have to worry about $4.00 gas. I just read an article that corrects my ignorant thinking.
Recognizing the tarsands
National Post
Published: Wednesday, January 16, 2008
http://www.nationalpost.com/opinion/story.html?id=241044
See..., I used to assume that even though it's true there are alot of tar sands, that tar sand production would follow a stretched out (wide) bell curve. I used to think it was slow process because it's not like sucking a fluid out of the ground, but instead a minning operation.
I guess I was just a dumb believer in PO. But I stand corrected.
Question to the peak oilers out there:
where do i go for production data for individual wells?
i'm not looking for entire oil fields, or whole countries, but just individual oil wells.
reason for this: i'm helping my son do a paper on peak oil and would like to show hubbert's bell curve for 1.) individual wells; 2.) individual fields; 3.) individual oi producing nations. so your comments are helpful.
* i'd prefer oil wells in norway and alsaka.
can't wait.
thanks...
William - I think the only place you will get well data is from the operating companies. If you are looking for Norway and Alaska then BP is your best bet. This is the sort of data they may release but the problem will be finding someone with the time to deal with the request - which will involve getting many bits of paper signed - and they are all pretty busy right now.
Alternatively the Norwegian Petroleum Directorate and the UK Department of Business, Enterprise and Regulatory Reform (BERR - formerly DTI) may hold these records that they may release:
http://www.npd.no/English/Frontpage.htm
http://www.berr.gov.uk/energy/index.html
Norway and the UK:
http://graphoilogy.blogspot.com/2006/05/some-detailed-views-on-norways-o...
http://graphoilogy.blogspot.com/2006/06/some-detailed-views-on-uks-oil.html
For Alaska try:
http://www.dog.dnr.state.ak.us/oil/links/links.htm
"Drilling a little deeper" try:
http://www.state.ak.us/local/akpages/ADMIN/ogc/homeogc.shtml
and:
http://www.state.ak.us/local/akpages/ADMIN/ogc/production/pindex.shtml
For the UK North Sea and Onshore try:
http://www.og.dti.gov.uk/pprs/full_production.htm
and for Norway try:
http://www.npd.no/English/frontpage.htm
Hope this helps as a starting point. A couple of years ago, I went down to the well level (Alaska data required ARCGIS at the time) and I know you can get down to the well level on the UK site (you merely have to pick one of the listed oil fields. I haven't done a lot with the Norwegian data beyond the field level data.
Good luck and let us know if we can help any further
ST
hey ST,
i went to the UK site and the field level is as far as i can go...
Hmmmm....
Seems that function must no longer be available through this link (or I found it another way). Field level may be as far they will let you go for the moment.
Found IT!!!!
Try :
http://www.og.dti.gov.uk/information/wells/pprs/welldataindex.htm
I'm going to bookmark this because I had to go a long way around to find this.
Good Luck
That is so interesting. When you focus right in you really get a sense of depletion.
In the US all companies must report their production to the state and federal government. Therefore, this data is all public. Most states with significant production have websites where you might find this data. Some states sites are far better than others. I have never looked for Alaska data. Wyoming has a particularly good website at http://wogcc.state.wy.us/.
At this site you can find data on individual fields and wells, but I am not sure about the entire state. The one problem is that the digital data available on the website only goes back to 1978 and most of the larger fields in the state were discovered, brought on production, and had peak production long before then. One fairly interesting field that I am aware of that was discovered after 1978 was Sand Dunes. This is a deep strat trap field which is why it was discovered later. It was developed with miscible gas injection. That is why the production was curtailed in the early 1990's. They had to shut-in significant production until it was unitized and pressure maintenance was initiated.
There are also private companies that compile all the public data and sell it. The biggest one is probably IHS, but of course they charge for the service.
Good luck,
jimb of wga (past president)?
No, different jimb I guess
thanks for all your help...
the problem with UK's production profile is that it shows 2 peaks. whereas norway's just has 1 peak and is in decline. which makes the case stronger for hubbert's peak oil. But gosh darnit! i can't find a site with norway's well produciton? any thoughts?
The interesting thing is how many more fields and how fast they fall in production in the second peak compared to the first peak (and I think it's been plotted here before. I have my own version from the UK data that I've created in Excel). One of the things about offshore fields is how fast they peak, particularly the smaller newer fields.
As for the individual well data in Norway, there probably is a way to get to it, I just can't recall how I did it in the past (or maybe I'm confusing it with the data available from the UK). I can get down to the individual well data(basics) but can't seem to find the production records (and the Norwegians are also renowned for their data and the availability of transparent records). I don't remember the maps being run in javascript.
i'm helping my son do a paper on peak oil and would like to show hubbert's bell curve for 1.) individual wells; 2.) individual fields; 3.) individual oi producing nations.
I hope that he has about 1,000 hours to devote to the paper so that he can do decent, but cursory, job.
Could the refineries producing less have something to do with this too? Bloomberg article (http://www.bloomberg.com/apps/news?pid=20602099&sid=aEiiRmKfPC9g&refer=e...) says:
They also state that refineries are slowing production because of margins...
Could changes in production due to margin have affected the supplies as well? I guess I've been wondering, how long could gas stay low and oil go up? The really creepy thing to me has been that here in Denver, pump prices have actually dipped to a point where compared to Nymex prices they are not even covering the taxes!! I know that the EIA likes to say we spend less on oil as a percentage of our income than we did in 1980, but I think there was actually a positive savings rate in 1980. People don't have the flexibility to weather changes in the prices of anything, even if it's a relatively small percentage of their income.
Possibly related story:
Refiners at Risk From Slump in Gasoline Demand, Marathon Says
http://science.reddit.com/info/65oul/comments/
have a ? about the alledged low inventory because of taxes at ye. arent these co.'s on a fiscal year basis ?
Error ....
Robert, how much impact do you think the high prices have had on inventories? I note that this week we see a build and that prices are back towards the lower $90s while the drawdown weeks we saw prices in the upper $90s. How much do price fluctuations like that impact decisions to buy or sell?
Thanks.
I think the taxes, refinery utilization, and price are all contributing to the inventory increase. That doesn't mean we'll see another increase next week.
Every week, I enjoy reading the “Weekly Petroleum Data.” I read it not for the data, but the message. Many of us read the weekly report as if it is the gas gage of peak oil and that everything in it is the truth. I am not saying it isn’t, but I am not saying it is either. The message in this report is that everything is okay …. stock markets, you can quit panicking.
Matthew R. Simmons, November 16, 2007, reminded us that “the report” is not audited and never has been; yet we take the numbers for fact.
Based on my perception, the numbers are a mix of fact and message. Up to today, the world stock markets have been in a state of anarchy. There has been mention of the Fed lowering interest rates by 75 basis points and an emergency meeting of the Fed. The euro has been hitting highs once again against the dollar. Gold is moving up. Peak oil isn’t something new to economists and the world powers. They aren’t naive. Over the past months, the world message has been shifting from, “we have years of supply left” to, “OPEC is pumping full out and the worlds key major fields are in decline.” Add to that all the bank losses and of course you get … equity anarchy.
The question is, how do the financial markets cope with a dwindling supply of the economic driver we call oil?
In the last couple of days leading up to this report, equity anarchy was accelerating. A few days ago, the crude message started to change. Suddenly, the message is “the consumers aren’t buying gasoline.” The department of commerce says we dropped by 1.7 percent in consumption.
“Purchases at gasoline service stations in the U.S. dropped 1.7 percent in December, contributing to the 0.4 percent decline for all retailers, Commerce Department data showed yesterday.”
New West's Mennis said. While the weaker macro-economy may be yet to have an impact on demand, the department's implied figures, based on fuel deliveries, may be reflecting refiners' efforts to clear stock and disguising slowing consumption at the pump.
``Cash market traders are complaining about an over-supply of products,'' he said.
``Refineries are selling and the buyers have just disappeared,'' Lewis Adam, president of ADMO Energy LLC, a supply consultant in Kansas City, Missouri, said yesterday.
Even Forbes magazine chimed in with the fact that “Casey same-store gasoline gallons sold fell 5.6 percent in December 2007 compared with December 2006.”
Unemployment is of course rising and we have all this data that supports demand for gasoline IS FINALLY falling … just as predicted.
Oops, we have one company that isn’t towing the line …. Master Card. They say, yesterday, demand for gasoline is up 2.6 percent year on year:
“American motorists pumped 9.342 million barrels per day on average in the week that ended Jan. 11, an increase of 0.5 percent over the previous week, according to MasterCard's weekly SpendingPulse report.
Last week's average gasoline demand was 2.6 percent higher than for the same week last year, but MasterCard attributed the gains to winter volatility as well.”
Ever since OPEC said at their last meeting in December they wouldn’t raise output, crude oil inventories have been declining sharply. Refined product has been doing better. The message, “see, refining isn’t the bottleneck, it is upstream production, OPEC.”
The message to the American people, along with our December energy bill (we need more ethanol and the like) is that we have an energy problem.
Over the last weeks we see what happens if bad things happen in the US. All the world markets take a beating. Let this be a strong message to all the world markets, you can’t go it alone without the US.
Today’s petroleum report numbers say, “don’t worry, we can build stockpiles and American consumers do what they are supposed to do, reduce demand under a high price tight supply.” The numbers did something even more important, they stopped the equity anarchy.
The report did have a few other important things to say. Cushing supplies once again got a little tighter … dropping from a sustained average of 17.5 mb to 16.5. It also told us that US production is dropping …. 5,117, 5,078, 5,051, 5,013 mbpd week on week. This isn’t a big deal, but the message is that not everything is well in the US production arena.
Now that these numbers are out, time for everyone to feel safe and cozy again. These numbers are powerful … they aren’t audited …. If I were king I’d use them to point perception. After all, perception is reality. I like the perception these numbers give me and everyone else … I am going back to bed.
Goodnight.
Forget oil, the new global crisis is food
http://www.financialpost.com/story.html?id=213343
http://omrpublic.iea.org/
IEA World oil supply averaged 87.0 mb/d in December, up 870 kb/d from November on increases in OPEC-10, North America, the FSU, Brazil and China. Global supply in 4Q was more than 1.0 mb/d higher than a year earlier, having averaged at or below levels of a year ago in the previous three quarters.
Is not the 87 mb/d a new record for supply ? A new peak that some at the oildrum said would not get reached ?
Data that doesn't fit the we are past peakoil narrative is being ignored, did you expect something else?
It's not being ignored by me. In fact, I highlighted the new all-liquids peak back in November or December, and I also predicted a new C+C peak for December.