DOE Week of June 22nd: Hot, hot, hot

  • This report was solid and decidedly bullish
  • By turnover days, excess crude continued to decline, now only 1.7 days turnover above long-term averages.  The US is running out of excess crude inventory.
  • Excess product inventories rose 9 mb by turnover days, which might be a concern had the rise not been the result of record refining throughput, suggesting increased product exports to come.
  • Excess crude and key products (CGD) were largely flat by turnover days.
  • Refinery runs set an all-time record at 17.8 mbpd
  • Net crude imports fell to 5.3 mbpd, an astounding 2.1 mbpd below last year’s level
  • Net product exports set a record for the week and posted the fifth highest level in the historical record. 
  • Compared to last year, production is up 1.65 mbpd.
  • WTI has recovered sharply with steep backwardation re-emerging. 
  • The incentive to store declined to lows for our series, with the market expecting an outright shortage of oil in the next three months following President Trump’s call to boycott Iranian oil.
  • This week, all the arrows point up.

DOE Week of June 22, 2018