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.
The latest Platts survey for the week ending January 27 is looking for a 3.0 million barrel build in crude stocks, a 1.2 million barrel draw in distillate supplies, and a 1.0 million barrel gain in gasoline inventories. Our cut at the numbers would suggest a somewhat smaller crude oil build than what the market is looking for but a more modest distillate stock decline, and a slight fall in gasoline stocks in contrast to consensus expectations of a build.
For the week ending January 13 the latest Platts survey is looking for a 2.6 million barrel build in crude oil stocks, a 1.4 million barrel rise in distillate supplies, and a 3.0 million barrel gain in gasoline inventories. Looking first at crude oil, right or wrong we would look for a retracement in imports from the prior week’s above-trend rate, and steady runs. With domestic crude oil production continuing to average modestly below 5.9 MMB/D, our arithmetic would suggest a gain in stocks smaller than consensus expectations.
Platts survey is looking for a 1.0 million barrel decline in crude oil stocks for the week ending January 6, a 1.35 million barrel rise in distillate supplies, and a 1.75 million barrel increase in gasoline inventories. In terms of crude oil, we had mentioned last week that stocks rose contrary to the mean of historical experience for the last reporting period of the year, but that technically there was one day left in 2011 when a tax-related draw on the Gulf Coast may have occurred. We will assume so, and as such our guesstimates would yield a decline in crude stocks last week exceeding consensus expectations. For refined products, we believe the odds should heavily favor a recovery in implied distillate demand such that the latest four-week average reverts back to our mean given our estimate of manufacturing activity. Assuming a slight decline in supply, we believe stocks fell slightly last week, contrary to what the market expects. For gasoline, we believe implied demand also recovered last week, though less so than distillate, and with a decline in imports we would estimate a draw in gasoline stocks. Thus, if our assessment is anywhere close, the market will likely wish to build on gains over the extreme short term, but then progressively respond to the recovery in crude stocks that should characterize the first quarter.
- 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 latest Platts survey is looking for a 2.25 million barrel draw in crude oil stocks for the week ending December 16, a 600,000 barrel decline in distillate inventories, and a 1.75 million barrel rise in gasoline supplies. Clearly the consensus has begun to expect year-end stock draws for crude oil, and depending on the magnitude will likely be discounted in advance. Our cursory cut at the data would suggest that last week witnessed a decline in crude stocks a bit less than consensus expectations, with larger draws reserved for later in the month. It would not surprise us to see a modest build in distillate stocks even assuming a further recovery in implied demand, while gasoline inventories are estimated to have risen somewhat more than the market expects.
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.
Oil may have either its own comeuppance or place in the sun via the weekly DOE stats. In this regard, the latest Platts survey for the week ending October 14 is looking for a 1.75 million barrel build in crude oil stocks, a 1.1 million barrel decline in distillate stocks, and a 1.25 million barrel fall in gasoline supplies. Our cursory cut at the crude oil data would suggest a falloff in imports in tandem with continued healthy domestic production and steady crude oil runs. The combination would imply a crude oil stock build short of consensus expectations. For distillate, almost irrespective of the pace of the economy we would expect implied distillate demand to ease back from the average of the last couple weeks, perhaps to 3.7-3.8 MMB/D or so. Assuming roughly steady supply would imply a build in stocks. Finally, for gasoline we would also look for a modest weakening in implied demand back to the underlying trend, a recovery in imports, and steady refinery output. The combination would suggest a gasoline draw less than the prior week, but exceeding market expectations.
The latest Platts survey has been looking for a 300,000 barrel draw in crude stocks, a 600,000 barrel decline in distillate supplies, and a 100,000 barrel gain in gasoline inventories. The API reported a 3.805 million barrel drop in crude stocks for the week ending October 7, a 3.119 million barrel fall in distillate supplies, and a 1.193 million barrel decline in gasoline inventories. Prior to our trip we had suggested a crude oil draw of less than 1.0 million barrels, but larger than the consensus. For distillate, we suggested a decline in implied demand from the previous week to revert to our estimated mean that would lead to a modest build in supplies. Gasoline stocks were estimated to have fallen last week, also in contrast to consensus expectations, assuming a modest uptick in implied demand.
- The weekly DOE data may provide some transient market effect, and in this regard the latest Platts survey for the week ending September 23 is looking for a 2.5 million barrel build in crude oil stocks, a 500,000 barrel decline in distillate supplies, and a 1.3 million barrel increase in gasoline inventories. We should see gross crude oil imports fall off from the prior week and revert closer to our estimated mean, while crude runs should be steady to modestly lower. Our numbers would suggest a modest draw in crude oil stocks. For distillate, implied demand should have averaged around 3.7 MMB/D or so, with supply steady to slightly lower. We would look for a build in distillate stocks, also in contrast to consensus expectations. For gasoline, our arithmetic implies an inventory gain coming in somewhat short of what the market is looking for.
