Commenter R.J.S.: Record drops in US oil output, US oil exports, distillates’ output on Texas freeze as US burns 15% of natural gas inventories in one week . . US oil data from the US Energy Information Administration for the week ending February 19th indicated that because the big drops in our oil exports and our oil refining associated with last week’s freeze off were greater than the big drops in our oil production and oil imports. We had a small surplus of oil left to add to our stored commercial crude supplies for the third time in the past fourteen weeks and for the 13th time in the past thirty-seven weeks. Our imports of crude oil fell by an average of 1,299,000 barrels per day to an average of 4,599,000 barrels per day, the largest drop
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Commenter R.J.S.: Record drops in US oil output, US oil exports, distillates’ output on Texas freeze as US burns 15% of natural gas inventories in one week . .
US oil data from the US Energy Information Administration for the week ending February 19th indicated that because the big drops in our oil exports and our oil refining associated with last week’s freeze off were greater than the big drops in our oil production and oil imports. We had a small surplus of oil left to add to our stored commercial crude supplies for the third time in the past fourteen weeks and for the 13th time in the past thirty-seven weeks. Our imports of crude oil fell by an average of 1,299,000 barrels per day to an average of 4,599,000 barrels per day, the largest drop in 32 weeks, after rising by an average of 41,000 barrels per day during the prior week. Our exports of crude oil fell by a record average of 1,548,000 barrels per day to 2,314,000 barrels per day during the week, which meant that our effective trade in oil worked out to a net import average of 2,285,000 barrels of per day during the week ending February 19th. Occurring were 249,000 more barrels per day than the net of our imports minus our exports during the prior week. Over the same period, the production of crude oil from US wells decreased by a record 1,100,000 barrels per day to 9,700,000 barrels per day, and hence our daily supply of oil from the net of our trade in oil and from well production appears to total an average of 11,985,000 barrels per day during this reporting week…
Meanwhile, US oil refineries reported they were processing 12,230,000 barrels of crude per day during the week ending February 19th, 2,589,000 fewer barrels per day than the amount of oil they used during the prior week, while over the same period the EIA’s surveys indicated that 184,000 barrels of oil per day were being added to the supplies of oil stored in the US….so looking at that data, this week’s crude oil figures from the EIA appear to indicate that our total working supply of oil from net imports and from oilfield production was 429,000 barrels per day less than what was added to storage plus what our oil refineries reported they used during the week….to account for that disparity between the apparent supply of oil and the apparent disposition of it, the EIA just plugged a (+429,000) barrel per day figure onto line 13 of the weekly U.S. Petroleum Balance Sheet to make the reported data for the daily supply of oil and the consumption of it balance out, essentially a fudge factor that they label in their footnotes as “unaccounted for crude oil”, thus suggesting an error or errors of that magnitude in the oil supply & demand figures we have just transcribed….however, since most everyone treats these weekly EIA figures as gospel and since these figures often drive oil pricing and hence decisions to drill or complete wells, we’ll continue to report them as published, just as they’re watched & believed to be accurate by most everyone in the industry…..(for more on how this weekly oil data is gathered, and the possible reasons for that “unaccounted for” oil, see this EIA explainer)….
Further details from the weekly Petroleum Status Report (pdf) indicate that the 4 week average of our oil imports fell to an average of 5,715,000 barrels per day last week, which was 13.3% less than the 6,589,000 barrel per day average that we were importing over the same four-week period last year…..the 184,000 barrel per day addition to our total crude inventories was all added to our commercially available stocks of crude oil, while the quantity of oil stored in our Strategic Petroleum Reserve remained unchanged….this week’s crude oil production was reported to be 1,100,000 barrels per day lower at 9,700,000 barrels per day, matching the largest drop on record, because the rounded estimate of the output from wells in the lower 48 states was 1,100,000 barrels per day lower at 9,200,000 barrels per day, while a 17,000 barrel per day decrease to 481,000 barrels per day in Alaska’s oil production had no impact on the rounded national total….last year’s US crude oil production for the week ending February 21st was rounded to 13,000,000 barrels per day, so this reporting week’s rounded oil production figure was 25.4% below that of a year ago, yet still 15.1% above the interim low of 8,428,000 barrels per day that US oil production fell to during the last week of June of 2016…
US oil refineries are operating at 68.6% of their capacity while using those 12,230,000 barrels of crude per day during the week ending February 19th, down from 83.1% of capacity during the prior week, and among the lowest refinery utilization rates in the last 30 years…hence, the 12,230,000 barrels per day of oil that were refined this week were 23.6% fewer barrels than the 16,008,000 barrels of crude that were being processed daily during the week ending February 21st of last year, when US refineries were operating at an also low 87.9% of capacity…
With the drop in the amount of oil being refined, the gasoline output from our refineries was lower for the 9th time in 14 weeks, decreasing by 1,295,000 barrels per day to 7,736,000 barrels per day during the week ending February 19th, after our gasoline output had increased by 375,000 barrels per day over the prior week…with that drop in production, this week’s gasoline output was 21.0% lower than the 9,797,000 barrels of gasoline that were being produced daily over the same week of last year….meanwhile, our refineries’ production of distillate fuels (diesel fuel and heat oil) decreased by a record 953,000 barrels per day to an eleven year low of 3,621,000 barrels per day, after our distillates output had decreased by 86,000 barrels per day over the prior week…with distillates’ production thus depressed, that output was 25.3% less than the 4,846,000 barrels of distillates that were being produced daily during the week ending February 21st, 2020…
Even with the decrease in our gasoline production, our supply of gasoline in storage at the end of the week increased for the 12th time in fifteen weeks, and for 15th time in 31 weeks, but was up by just 12,000 barrels to 257,096,000 barrels during the week ending February 19th, after our gasoline inventories had increased by 672,000 barrels over the prior week…our gasoline supplies increased this week despite the production drop because the amount of gasoline supplied to US users decreased by 2,200,000 barrels per day to a nine month low of 7,207,000 barrels per day, even as our imports of gasoline fell by 139,000 barrels per day to 531,000 barrels per day, while our exports of gasoline fell by 59,000 barrels per day to 517,000 barrels per day…..after this week’s inventory increase, our gasoline supplies were 0.3% higher than last February 21st’s gasoline inventories of 256,387,000 barrels, and about 1% above the five year average of our gasoline supplies for this time of the year…
The record decrease in our distillates production resulted in our supplies of distillate fuels decreased for the 18th time in 26 weeks and for the 29th time in the past year, falling by 4,969,000 barrels to 152,715,000 barrels during the week ending February 19th, after our distillates supplies had decreased by 3,422,000 barrels during the prior week….our distillates supplies fell by more this week even though the amount of distillates supplied to US markets, an indicator of our domestic demand, fell by 522,000 barrels per day to 3,932,000 barrels per day, and even though our exports of distillates fell by 270,000 barrels per day to a 41 month low of 701,000 barrels per day, while our imports of distillates fell by 59,000 barrels per day to 303,000 barrels per day…but even after this week’s inventory decrease, our distillate supplies at the end of the week were still 10.3% above the 138,472,000 barrels of distillates that we had in storage on February 21st, 2020, and about 3% above the five year average of distillates stocks for this time of the year…
The big drops in our oil exports and our refinery throughput resulted in our commercial supplies of crude oil in storage (not including the commercial oil being stored in the SPR) ended the week higher for the 9th time in the past thirty-one weeks, and for the 29th time in the past year, increasing by 1,285,000 barrels, from 461,757,000 barrels on February 12th to463,042,000 barrels on February 19th…after that increase, our commercial crude oil inventories remained near the five-year average of crude oil supplies for this time of year, but were about 36% above the prior 5 year (2011 – 2015) average of our crude oil stocks as of the third weekend of February, with the disparity between those comparisons arising because it wasn’t until early 2015 that our oil inventories first topped 400 million barrels….since our crude oil inventories had jumped to record highs during the lockdowns this spring after generally rising over the past two years, except for during the 10 weeks prior to this one and during the past two summers, after generally falling over the year and a half prior to September of 2018, our commercial crude oil supplies as of February 19th were 4.4% more than the 443,335,000 barrels of oil we had in commercial storage on February 21st of 2020, 3.8% above the 445,865,000 barrels of oil that we had in storage on February 22nd of 2019, and also 10.1% more than the 420,479,000 barrels of oil we had in commercial storage on February 16th of 2018…
The natural gas storage report from the EIA for the week ending February 19th indicated that the amount of natural gas held in underground storage in the US fell by 338 billion cubic feet to 1,943 billion cubic feet by the end of the week, which left our gas supplies 298 billion cubic feet, or 13.3% below the 2,241 billion cubic feet that were in storage on February 19th of last year, and 161 billion cubic feet, or 7.7% below the five-year average of 2,104 billion cubic feet of natural gas that have been in storage as of the 19th of February in recent years….the 338 billion cubic feet that were drawn out of US natural gas storage this week was the 2nd largest withdrawal on record, and was more than the average forecast of a 333 billion cubic foot withdrawal from an S&P Global Platts survey of analysts, and was more than double the 145 billion cubic foot withdrawal from natural gas storage seen during the corresponding week of a year earlier, as well as the average withdrawal of 120 billion cubic feet of natural gas that have typically been pulled out of natural gas storage during the same week over the past 5 years…