Market Report & Analysis for 6/29/2018 Afternoon Edition

Afternoon Market Overview

This week’s EIA report was overall bullish based on total combined crude oil and refined product inventories decreasing for the week. Total combined stocks are now 156.3 million bbls below the record high hit at the end of the first week of February of 2017.

The EIA reported a draw in crude oil with a build in gasoline inventories with distillate fuel stocks coming in unchanged. Total US crude oil production increased after coming in unchanged the previous week. Total US production remains above the average annual high hit in 1970 and above the average monthly record high hit in October of 1970 of 10.013 million bpd. Total US crude oil production is now 1.325 million bpd above the average annual record high in 1970 and 949,000 above the record monthly high in October of 1970. Total US crude oil production is about 19.5 percent above where it was for the same week a year ago.

This week’s production came in at 10.962 million bpd. Total commercial stocks of crude oil and refined products were lower by 4.6 million bbls after increasing during the previous week. The year over year deficit came in at 148.6 million barrels while the deficit versus the five- year average for the same week came in at 17.7 million barrels. Total combined stocks of crude and refined products have been decreasing for the last few months and are still 156.3 million bbls off their record high level. Total crude oil inventories decreased as total crude oil exports increased more than imports increased. Total crude stocks decreased by 9.9 million barrels. With the decrease in crude oil stocks this week the crude oil inventory status versus last year is showing a deficit of 92.6 million barrels while the deficit versus the five-year average for the same week came in around 12.8 million barrels.

Distillate stocks were unchanged versus the market expectation for a build as total US refinery runs increased to 97.5 percent of capacity with exports increasing strongly on the week. The year over year comparison shows current stock levels at about 34.9 million barrels below last year. The five-year average deficit came in around 23.7 million barrels.

Gasoline inventories increased by 1.2 million bbls and are still off the record high level hit early in 2017. The surplus versus last year came in around 0.2 million barrels while the surplus versus the five-year average for the same week came in at 14.4 million barrels.