EIA Weekly Report week ending December 14, 2018
Highlights:
- For the week ending December 14, US Crude inventories drew by 0.500 Mbbls, while API was reporting a build of 3.5 Mbbls and analysts were expecting a draw of 2.4 Mbbls.
- Gasoline inventory built by 1.8 Mbbls, while is in line with API’s figure and analyst expectations was showing a 1.2 Mbbls build.
- Distillate inventory drew down by 4.2 Mbbls, compared with API’s 3.4 Mbbls draw while analysts were expecting a build of 0.573 Mbbls.
- Total Refinery Utilization is up by 0.3% to 95.4%.
- Cushing inventory built by 1.1 Mbbls.
- Crude Imports increased by 30 kbpd and Crude Exports is up by 51 kbpd. Total product exports is lower by 464 kbpd.
- Lower 48 crude production is unchanged.
- Real crude supply decreased by 1,084 kbpd with an adjustment factor of 525 kbpd.
- Finished gasoline production decreased by 123 kbpd to 10.3 Mbpd and total distillate production decreased by 152 kbpd to 5.4 Mbpd.
- Total Product demand is higher by 848 kbpd. Gasoline demand increased by 207 kbpd, while Distillate demand increased by 417 kbpd.
Our Interpretation:
Bullish = +1
Bearish = -1
Scale = -9 to +9
|
Crude Inventory |
Gasoline Inventory | Distillate Inventory | Product Demand | Product Supply | Crude Imports | Crude Exports | Ref Utilization | L48 Crude Production | Bullish/Bearish (+/-) |
| 0 | -1 | 1 | 1 |
1 |
0 |
0 | 0 | 0 |
2 |
- We are slightly bullish on this week’s stats due to positive increase in product demand, a sizable draw in Distillate inventory and lower product supply.
- Product demand is up by 850 kbpd due to a large jump in gasoline and distillate demand. Lower product prices have helped lift demand as expected and distillate demand should continue to see a seasonal pick up. Distillate is marking five year high demand this past week.
- After last week’s surge to above +3.0 Mbpd Net Export balance, this week’s EIA stats have US Crude and Product Net Export Balance just shy of 1.0 Mbpd. The overall trajectory of the US Net Export Balance has steadily climbed from -2.0 to -2.5 Mbpd in Q3’18 to where the balance sits now at Q4’18. This represents a fundamental shift in the US’ role in global crude and supply balances, hence why current market price is reflecting such concern of oversupply and we expect this trend to continue because the US crude production is forecasted to steadily climb into 2019.
- PADD II crude imports were down quite heavily by 350 kbpd and this may be due to lingering pipeline issues, as the week prior there were 2 temporary Canadian pipelines outages including Keystone Legacy and Enbridge Mainline.
