The latest weekly stats, the Platts survey for the week ending February 3 calls for a 2.25 million barrel gain in crude oil supplies, a 200,000 barrel decline in distillate stocks, and a 1.25 million barrel increase in gasoline inventories. The latest Reuters survey calls for a 2.6 million barrel rise in crude oil supplies, a 600,000 barrel fall in distillate stocks, and a 200,000 barrel gain in gasoline inventories. With regard to crude oil, our cursory cut at the data would suggest, assuming steady production and refinery runs in combination with a slight decline in gross imports, a stock build somewhat less than consensus expectations. We estimate that implied distillate demand should have rebounded last week to 3.8+ MMB/D despite the weather as diesel demand reverts to our expected underlying mean. With steady supply, however, our scenario would still imply little change in total distillate inventories last week. For gasoline, we would look for a rebound in implied demand back above 8.0 MMB/D, with gross imports retracing from the previous week’s average exceeding 1.0 MMB/D. Nonetheless, with steady refinery output our arithmetic would imply a stock build in between the Reuters and Platts estimates, i.e. around 700,000 barrels.
- For the week ending December 23, the latest Platts survey is looking for a 2.3 million barrel decline in U.S. crude oil stocks, a 1.2 million barrel fall in distillate supplies, and a 500,000 barrel drop in gasoline inventories. In the context of our discussion yesterday morning, our expected crude oil stock decline would fall close to consensus expectations. Because we expect some retracement in implied distillate demand back toward our underling mean, we would look for a somewhat smaller decline in distillate supplies than the market is expecting. We are also looking for a modest build in gasoline supplies, but if pre-holiday secondary stocking exceeded our estimates primary inventories could have easily fallen in line with consensus expectations. We note the comparable period last year witnessed a healthy gasoline stock draw, but in general history is not perfectly consistent prior to the Christmas holiday. In addition, underlying gasoline consumption is so weak at the present time the arithmetic suggests it could offset any pre-holiday secondary stocking effect.
The DOE states the weekly data will be released as customary on Wednesday morning. In this
regard, the latest Platts survey is looking for a 1.0 million barrel build in crude oil stocks, a 1.5 million
barrel decline in distillate supplies, and a 1.5 million barrel build in gasoline inventories. Our cursory cut at
the data would suggest that crude oil runs were steady to up modestly, domestic crude oil production
averaged close to 5.9 MMB/D, but gross imports recovered from the prior week. Nonetheless, our
arithmetic yields a modest crude oil stock draw. For distillate, we would look for a further easing in
implied demand to around 4.0 MMB/D. Gross imports should ease somewhat, refinery production about
steady, while gross exports remain quite healthy. We would look for a distillate stock decline somewhat
smaller than consensus expectations. Finally, despite an expected modest recovery in implied demand from
the prior week and a retracement in both gross imports and refinery output, our numbers suggest a larger
gasoline stock build than the market is looking for.
US Crude Stocks- Up 4.735 MB (Cushing Stocks – Up 0.419 at 31.511 MB)
US Gasoline Stocks- Down 1.353 MB
US Distillate Stocks- Down 4.275 MB
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US Crude Stocks- Down 4.729 MB (Cushing Stocks – Up 0.471 at 31.092 MB)
US Gasoline Stocks- Down 3.324 MB
US Distillate Stocks- Down 4.266 MB
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US Crude Stocks- Up 1.344 MB (Cushing Stocks – Up 0.532 at 30.321 MB)
US Gasoline Stocks- Down 4.134 MB
US Distillate Stocks- Down 2.929 MB
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US Crude Stocks- Down 4.679 MB (Cushing Stocks – Down 0.831 at 30.089 MB)
US Gasoline Stocks- Down 1.137 MB
US Distillate Stocks- Down 0.744 MB
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US Crude Stocks- UP 1.915 MB (Cushing Stocks – Down 1.078 at 30.92 MB)
US Gasoline Stocks- Up 0.791 MB
US Distillate Stocks- UP 0.072 MB
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US Crude Stocks- Down 7.336 MB (Cushing Stocks – Down 0.231 at 31.998 MB)
US Gasoline Stocks- Up 3.95 MB
US Distillate Stocks- Down 0.874 MB
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The latest Platts survey for the week ending September 2 is looking for a 1.7 million barrel decline in crude stocks, a 900,000 barrel fall in gasoline supplies, and a 600,000 barrel gain in distillate inventories. In terms of crude oil, the DOE indicates that the last SPR barrels were picked up as of September 1, and thus assuming a concurrent transfer we would include another 5.4-odd million barrels into commercial inventory. Allowing for production shut ins and some reduction in imports, our arithmetic would suggest basically no change in crude oil stocks, taking into account the PAD I refinery run cuts as a result of Irene. For gasoline, as previously discussed we would look for some retracement in implied demand from the week before reflecting the halt in pre-Irene precautionary secondary stock building and reduced driving due to flooding. Allowing for a fall in refinery output, our numbers would still suggest a modest build in gasoline supplies. Finally, for distillate, lower refinery production was also likely accompanied by a decline in implied demand, but not to the degree of gasoline due to the use by portable generators to compensate for electricity grid outages. We believe distillate stocks rose more than the market expects.
Hornsby Trading News
- Platts Energy Inventory Survey Plus Hornsby & Company Inventory Assessment – February 7th.
- US NATURAL GAS INVENTORY SURVEY: Draw Of 126 Bcf Expected – Dow Jones
- Weekly DOE Inventory Report – February 1st.
- API Inventory Report – January 31st.
- Platts Energy Inventory Survey Plus Hornsby & Company Inventory Assessment – January 31st.