The latest Platts survey is looking for a 1.9 million barrel build in crude oil stocks, a 1.0 million barrel fall in gasoline supplies, and a 1.0 million barrel increase in distillate inventories. Our cursory cut at the numbers for crude oil would suggest largely unchanged refinery runs as autumn turnarounds continue. Domestic crude oil production is pegged at about 5.5 MMB/D, while gross imports should have fallen off from the prior week and reverted to our estimated underlying mean. We would estimate gross imports fell back to average around 9.5-9.6 MMB/D from the near-9.9 MMB/D average of the week before. Adding up all components would suggest a crude oil stock build a bit less than consensus expectations.
The latest Platts survey is looking for a 1.1 million barrel build in crude oil stocks, an 875,000 barrel increase in gasoline supplies, and a 950,000 barrel increase in distillate inventories. Taking a look at our guesstimates for crude oil, we have assumed a modest reduction in refinery crude oil runs for the week ending August 20, with gross imports rebounding to a degree. Assuming domestic crude oil production averaging around 5.35 MMB/D last week, our calculations would still suggest a crude oil stock build less than consensus expectations.
With regard to refined products, implied gasoline demand is estimated to have eased slightly last week and revert to our estimated underlying mean. Refinery production of finished mogas declined in tandem with our estimated run reduction, while gross imports of total gasoline should have fallen back a bit below 1.0 MMB/D due to the closing arb, unless there was a greater lagged effect from hedged European cargoes than we have assumed. The combination of inputs would imply a smaller gasoline stock build than the market is looking for. Finally, for distillate fuel oil once again the key will be implied demand, which we have assumed eased a bit from the prior week. We are not suggesting we have modified our assumptions with regard to manufacturing activity; our models simply suggest that a modest retracement in demand from the prior week would imply a reversion to our estimated mean. With refinery output and gross imports of distillate both off modestly last week and assuming gross exports averaging around 600 MB/D, our numbers would still suggest a distillate stock build modestly exceeding analysts’ expectations.
Hornsby Trading News
- Daily Energy Report From MF Global, Inc. – Friday, September 3rd.
- Daily Energy Report From MF Global, Inc. – Thursday, September 2nd.
- Daily Energy Report From MF Global, Inc. – Wednesday, September 1st.
- Daily Energy Report From MF Global, Inc. – Tuesday, August 31st.
- Platts Estimate Of Energy Inventories – August 31, 2010