Tag: Crude Oil

World Oil Supply And Price Outlook, August 2019

Posted on by Robert Boslego

The Energy Information Administration released its Short-Term Energy Outlook for August, and it shows that OECD oil inventories likely bottomed last June 2018 at 2.805 billion barrels. It estimated stocks dropped 16 million barrels in July to 2.887 billion, 61 million barrels higher than a year ago.

However, for the balance of 2019, OECD inventories are projected to rise, on balance. The third quarter seasonal stock draw is over. At year-end, EIA projects 2019 to be at 2.901 million barrels, 40 million more than at the end of 2018. For 2020, EIA projects that stocks will build 58 million barrels to end the year at 2.959 billion.

Oil

The EIA has revised its estimates for future OPEC production down significantly, given the sanctions on both Iran and Venezuela. For much of the balance of 2019 and 2020, it expects OPEC production to remain under 30 million barrels per day. July was reported at 29.61 mmbd. Continue reading "World Oil Supply And Price Outlook, August 2019" →

OPEC's Unplanned Outages Supported Oil Prices

Posted on by Robert Boslego

In early July, OPEC+ rolled-over its December 2018 agreement for another nine months ending March 2020. To get an idea of compliance with that agreement to-date, I compared changes in production from October 2018 (the base period) and June 2019, except for Russia, May 2019 due to a lack of data for June.

I found that OPEC delivered a cut of 2.46 million barrels per day, of 8%. That is more than three times its pledge of 800,000 b/d. The primary reason for such a large cut was sanctions on Iran and Venezuela.

Iran reduced its reported output by 1.3 million barrels per day or 38%. Venezuela reduced its output by 600,000 b/d, or 46%. It’s important to understand that both of those cuts were involuntary.

The largest voluntary cut was by Saudi Arabia, 620,000 b/d, or 8%. Saudi Aramco (ARMCO) lifted its production by 200,000 b/d in June from May to 10.1 million barrels per day.

OPEC

Note: Russia’s change is until May 2019. Continue reading "OPEC's Unplanned Outages Supported Oil Prices" →

World Oil Supply And Price Outlook, July 2019

Posted on by Robert Boslego

The Energy Information Administration released its Short-Term Energy Outlook for July, and it shows that OECD oil inventories likely bottomed last June 2018 at 2.805 billion barrels. It estimated stocks dipped by 4 million barrels in June 2019 to 2.902 billion, 97 million barrels higher than a year ago.

However, throughout 2019, OECD inventories are no longer expected to rise any further, on balance. At year-end, EIA projects 2019 to be with 2.899 million barrels, 37 million more than at the end of 2018. For 2020, EIA projects that stocks will build 35 million barrels to end the year at 2.934 billion.

oecd oil inventories

The EIA has revised its estimates for future OPEC production down significantly, given the sanctions on both Iran and Venezuela. For much of the balance of 2019 and 2020, it expects OPEC production to remain under 30 million barrels per day. June was reported at 29.8 mmbd.

OPEC has revised its call (demand) for OPEC oil. For 2020, the average is 29.2 mmbd. Therefore, OPEC must cut supply by another 550,000 b/d from June next year just to balance stocks. Continue reading "World Oil Supply And Price Outlook, July 2019" →

U.S. Crude Production Surges In April

Posted on by Robert Boslego

The Energy Information Administration reported that April crude oil production averaged 12.162 million barrels per day (mmbd), up 257,000 b/d from March. The rise resulted from a 107,000 b/d increase in Texas, a 77,000 b/d increase in the Gulf of Mexico (GOM), a 32,000 b/d increase in Oklahoma, a 14,000 b/d increase in Colorado, and a 13,000 b/d increase in Wyoming.

Crude Production

A pause in the growth rate in Texas had been expected due to pipeline constraints, which are expected to be alleviated in the second half of 2019 and the first half of 2020. Nonetheless, crude production set yet another record high in April.

Crude Production

The year-over-year gains have been especially impressive with the April figure being 1.687 mmbd. And this number only includes crude oil. Other supplies (liquids) that are part of the petroleum supply add to that. For April, that additional gain is about 630,000 b/d. Continue reading "U.S. Crude Production Surges In April" →

World Oil Supply And Price Outlook, June 2019

Posted on by Robert Boslego

The Energy Information Administration released its Short-Term Energy Outlook for June, and it shows that OECD oil inventories likely bottomed last June 2018 at 2.804 billion barrels. It estimated stocks rose by 38 million barrels in May to 2.902 billion, 84 million barrels higher than a year ago.

However, throughout 2019, OECD inventories are no longer expected to rise any further. At year-end, EIA projects 2019 to be with 2.871 million barrels, 10 million more than at the end of 2018. For 2020, EIA projects that stocks will build 49 million barrels to end the year at 2.920 billion.

oecd oil inventories

The EIA has revised its estimates for future OPEC production down significantly, given the sanctions on both Iran and Venezuela. For much of the balance of 2019 and 2020, it expects OPEC production to remain under 30 million barrels per day. U.S. shale is expected to capture market share from OPEC. Continue reading "World Oil Supply And Price Outlook, June 2019" →