Author: Robert Boslego

2018 U.S. Gasoline Season Outlook

Posted on by Robert Boslego

Robert Boslego - INO.com Contributor - Energies - U.S. Gasoline


OPEC’s Monthly Oil Market Report (MOMR) for April featured an article on the summer petroleum products market. It observed that the U.S. is typically the key driver for products markets in the run-up to the summer driving season, and indicators are pointing to a positive and optimistic outlook.

It cites year-over-year January combined gasoline and diesel growth of 845,000 b/d. It states that the weekly data in February and March further supported this positive trend. And it concludes U.S. gasoline and distillates demand will grow by around a combined 992,000 b/d in 2018.

But a closer examination of gasoline demand and consumption estimates provide a different picture. Also, the MOMR totally ignored the supply side of the market, and last summer’s Hurricane Harvey and Mexico’s refinery problems contributed to support that is unlikely to be repeated this summer. Continue reading "2018 U.S. Gasoline Season Outlook" →

Updated World Oil Forecast For April

Posted on by Robert Boslego

Robert Boslego - INO.com Contributor - Energies - World Oil Forecast


According to the Energy Information Administration (EIA), world oil production will exceed demand for much of the balance of 2018, and therefore global OECD oil inventories are projected to rise. Specifically, the EIA estimates that OECD inventories bottomed at the end of March at 2.784 million barrels (mmb) and will rise by 80 mmb through year-end, up 26 mmb from December 2017. And its projections through 2019 show another net stock gain of 34 mmb to end the year at 2.898 mmb.

World Oil Forecast

The DOE forecasts for 2018 and 2019 are based on dramatically different seasonal stock changes that occurred in 2017. OECD stocks fell by over 147 mmb from August through December, according to the latest estimates. But in 2018, it is predicting a net stock build over those same months.

World Oil Forecast

In 2019, it is forecasting a build similar to 2018, but without a first-quarter draw. Continue reading "Updated World Oil Forecast For April" →

Analysis Of The EIA Crude Oil Statistics

Posted on by Robert Boslego

Robert Boslego - INO.com Contributor - Energies - Crude Oil Statistics


According to the Energy Information Administration (EIA), U.S. petroleum inventories (excluding SPR) fell by 6.9 million barrels (mmb) last week. They stand about 52 mmb lower than the rising, rolling 5-year average and are about 149 mmb lower than a year ago. However, comparing total inventories to the pre-glut average (end-2014), stocks are 127 mmb above that average.

Crude Oil Statistics

Commercial crude stocks fell by 2.6 mmb, and SPR stocks were unchanged last week. Gasoline stocks fell by 1.7 mmb, and distillate stocks fell 2.0 mmb. Primary demand dropped 256,000 b/d to average 20.675 million barrels per day (mmbd). Continue reading "Analysis Of The EIA Crude Oil Statistics" →

Updated 2018 Crude Oil Outlook

Posted on by Robert Boslego

Robert Boslego - INO.com Contributor - Energies - Crude Oil Outlook


Analysis prepared on March 19, 2018

The relative rate of growth in supply v. demand will ultimately determine stock levels and prices. And the three key predicting agencies, the International Energy Agency (IEA), Energy Information Administration (EIA), and OPEC have different views on what is likely to unfold.

OPEC does not often predict is own production, but in December it forecast it would average 33.2 million barrels per day (mmbd) during 2018. That would far exceed its projected “call on OPEC oil,” which is world demand minus non-OPEC production. For 2018 as a whole, it predicts that figure will be 33.1 mmbd.

That demand for OPEC oil is based on a gain in demand of 1.52 mmbd and a rise in no-OPEC production of 1.15 mmbd. In my view demand is likely to be a bit stronger due to world economic growth. However, the non-OPEC supply number is much too low, given the recent rise in U.S. production of 886,000 b/d from August through November. (December production was down a bit for seasonal reasons.) Furthermore, U.S. production has yet to respond to $60/b. The rise in output last autumn was a response to $50/b.

The EIA has the most aggressive non-OPEC production estimate of a gain of 2.5 mmbd, with 2.0 occurring in the U.S. alone, and the balance in Canada and Brazil. The EIA forecast is based on a gain in crude production of 1.5 mmbd and a rise in other liquids of 500,000 b/d. WTI did not exceed $60 in any month since 2015 until January 2018. And the year-over-year gain in March 2018 is estimated to be 1.29 mmbd. And so the industry’s response to $60/b could very well enable the 1.5 mmbd gain. Continue reading "Updated 2018 Crude Oil Outlook" →

U.S. Crude Production Eased In December

Posted on by Robert Boslego

Robert Boslego - INO.com Contributor - Energies - U.S. Crude Production


The Energy Information Administration (EIA) reported that December U.S. crude production averaged 9.949 million barrels per day (mmbd) in December, off 108,000 b/d from November. The primary cause of the decline was unexpected seasonal factors, which caused production in the Gulf of Mexico (GOM) to drop by 131,000 b/d and output in North Dakota to dip by 15,000 b/d. The EIA had expected a 30,000 b/d dip in GOM production. Meanwhile, production in Texas and New Mexico reached new historically-high levels of 3.933 mmbd and 556,000 b/d, rising 36,000 b/d and 26,000 b/d, respectively.

It is worth noting that EIA also revised its November estimate up by 19,000 b/d to 10.057 mmbd. As a result, November 2017 broke the November 1970 production record of 10.044 mmbd.

Even with December’s seasonal drop, the EIA-914 Petroleum Supply Monthly (PSM) figure was still 193,000 b/d higher than the week data reported by EIA in the Weekly Petroleum Supply Report (WPSR), averaged for the month, of 9.756 mmbd. EIA’s model failed to forecast the surge in production which began in August and totaled 846,000 b/d through November. Continue reading "U.S. Crude Production Eased In December" →