Posts tagged “refinery utilization”
While U.S. crude oil inventories have been surging since last fall, I have argued that these inventories should peak off soon. There are several reasons for this, but the primary reason is that March is historically the month that refinery utilization is at its lowest, due to the popularity of performing refinery maintenance during the month. The difference in crude oil demand from refiners between March and July has historically been about 10 million barrels per week. This alone should be enough to halt the ~8 million weekly crude oil build that we have seen thus far in 2015.
Another factor is that the large capital spending cuts that have accompanied the oil price collapse will begin to negatively impact oil production. The Energy Information Administration reported 2 weeks ago that U.S. oil production had suffered a weekly decline for the first time since January. Last week, production was almost flat, up only 18,000 bpd over the previous week. Meanwhile, U.S. refinery inputs surged by 201,000 bpd, climbing back above 90% utilization for the first time in 2 months. This should have dropped crude oil inventories by more than a million barrels for the week, but the EIA reported a huge inventory build of nearly 11 million barrels for the week.
What is the explanation for this? CONTINUE»
In my previous column – Is the U.S. Running Out of Crude Oil Storage? – I discussed the tightening crude oil storage picture in the U.S. That column has already generated the highest level of feedback and inquiries from readers and the media of any I have written in quite some time. So I want to follow up and drill down a little more, and show why this situation is more dynamic than is typically conveyed.
Since I wrote that article, there have been 2 more weeks of crude oil storage builds. Pundits continue to predict that crude oil prices have nowhere to go but down, because something has to give. Well, something is about to give. CONTINUE»
Introducing the “Energy Ticker” There has been a lot of important energy news this week; in fact so much that I could hardly hope to cover it all. Due to the volume of new energy stories every day, we at Consumer Energy Report have instituted a new feature designed to keep readers up to date on recent important energy-related news stories. That page, called the “Energy Ticker” (image to the right), will serve as the new homepage for Consumer Energy Report. Stories currently featured there include articles on gas prices, peak coal, global warming, energy storage, oil company subsidies, new energy technologies, and BP’s quarterly profits. Readers can even submit their own news links via a simple form. Our plans… Continue»