PeakOil.com: Weekly Petroleum Supply Report 6.12.10

Review of last week:

1. A gigantic oil tanker, the A-Whale, specially modified to suck oily water out of the Gulf, was moved into place over the oil slick and initial reports are that it does just half of that…..

2. The pup55 Jet Ski index, recently developed by me to estimate US unleaded consumption over the 4th of July weekend based on the concentration of jet ski usage at the lake I go to down here proved to be right on the money. Historically the average unleaded consumption the week after July 4th decreased by an average of .05 mbpd over the last few years, and this week’s Jet Ski Index confirms this….

3. The population of Cleveland decreased by 1 this week, the state of Ohio will take a couple of million dollar hit in reduced income tax receipts, and effect on state domestic product will actually be measurable, without the $25 or $30 million this fellow was making to put a round ball in a round hoop for 41 games….. and then folding up in the playoffs. I know it sounds Kunstler-esque but I have to say, they have a lot worse problems to worry about, such as the departure of their manufacturing sector.

4. The DJIA increased by 3% last week, in anticipation of favorable earnings on the part of JP Morgan and Bank of America, two companies that were huge recipients of Federal bailout money a year ago to keep the entire economy from collapsing……I am still having trouble with the logic behind this….I think we will have to look at the earnings of the Alcoa Corp, a company that actually makes things, to see how the economy is doing. We also got a report that oil imports from China increased by 25% year on year this week…

The tropical depression this week probably did not slow down the tankers that run between Mexico and the US, and I think the oil that did not show up last week due to the little hurricane will make it to shore (at the LOOP rather than washing up on the beaches) and we will see an increase in the non-slick related crude oil imports. Refinery utilization will continue to drift around 89 percent, with corresponding drifting of the crude oil inputs. Distillates are still a mystery, I do not know what accident of nature or accounting caused the jump in distillate consumption last week, I am estimating some regression toward the mean. Unleaded: If we imported a lot of unleaded, the inventory will go up. If we didn’t the inventory will go down. We’re producing just about the same amount as we’re using at the moment.

pup55
Crude Oil 1.30
Unleaded 1.69
Distillates -0.3

Analysis after the report is released later this morning…

The frequent viewers of this thread well know what happened: Crude oil imports were only 9.2 mbpd which must still be hurricane-impaired residual from last week. Couple that with an extra .1 mbpd crude oil imports to refineries, and an extra .1 less domestic crude oil production, and you get what you get, which is a big drawdown that even the API report did not see.

On unleaded, the demand/products supplied were actually way off from last week, I think products supplied were 9.4 a week ago, and this week just over 9.0 which is an enormous drop, I will have to recalibrate my jetski index based on that.

For distillates, the products supplied/demand actually fell to 3.5 mbpd which is way lower than the 3.9 that was reported last week, but those numbers have been bouncing all over for the last month. I think the 3.9 was probably the bad number.

It will be interesting to see what the market does with this, because, as you know, sometimes there is something in it for everybody. The bulls will see the refinery utilization over 90% and the import reduction and drawdown of crude oil and say “buy” and the bears will point to those terrible demand numbers for the finished products and say “sell”…..

Join the discussion…