Posted in: Infrastructure,
by Patrick DeHaan on May 26, 2010 11:24 AM
The Department of Energy released its weekly report on the condition of petroleum inventories in the United States today.
Here are some highlights:
Crude oil inventories increased by 2.4 million barrels to a total of 365.1 million barrels. At 365.1 million barrels, inventories are now 0.1% higher than last year, and remain above average. Supply at NYMEX delivery point, Cushing, Oklahoma dropped some 0.3 million barrels as inventories there remain much above average, but below last week. Oil at NYMEX delivery point Cushing, OK amounts to 37.6 million barrels this week.
Gasoline inventories decreased by 0.2 million barrels to a total of 221.6 million barrels. At 221.6 million barrels, inventories are 6.3% higher than last year. Even while inventories dropped this week, the gain vs. last year widened from 5.7%. Decreases in gasoline inventories were seen on the West Coast (-1.5mb) and in Rocky Mountain states (-0.3mb). The East Coast posted a large 1.1mb gain as imports likely boosted numbers.
Distillate inventories increased by 0.3 million barrels to a total of 152.5 million barrels. At 152.5 million barrels, inventories are now 0.1% lower than a year ago. Demand for distillate fuel (diesel, industrial fuels) is up an average of 15.8% over the last four weeks, a leading sign of the health of the economy. This is a main reason why retail diesel prices remain above the price of gasoline.
Refinery utilization fell slightly to 87.8%, a decrease of 0.1% over last week's numbers. Gasoline production decreased compared to last week to 9.0 million barrels per day while distillate fuel production averaged 4.2 million barrels per day, also a decrease over the prior week.
Overall, a this report may lead to prices increasing on Wall Street as a number of factors in this report look bullish (rising distillate demand, falling inventories for the first time in Cushing, lower gasoline production). I'll be watching as wholesale prices rebound- we may see minor price increases in areas of the Midwest that have seen prices fall so dramatically that stations may begin losing money as they purchase new supply.