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Msg  5640 of 5761  at  1/16/2020 10:23:05 PM  by


Overcoming Incredible Builds ....

Overcoming Incredible Builds

Oil prices are trying to overcome major historic product build based on optimism that the U.S.-China Trade Phase One deal will be another key turning point in the U.S. energy export revolution. Shale producers are looking at the deal with cautious optimism with the commitment to buy 50 billion in energy products over the next two years. While the breakdown of exactly what they are going to buy is unclear, it is welcome news for U.S. shale producers that have been fighting an uphill battle producing more but making less or losing money.

Still, the fact the U.S., according to the Energy Information Administration (EIA), hit 13 million barrels a day, another record for crude production shows that they still believe there will be a market. Still, stunning increases in gasoline and distillates kept oil bulls off balance.

Patrick DeHaan, head of petroleum analysis at GasBuddy, told MarketWatch that, "total U.S. gasoline stockpiles have never been this high so early in the year (258.3 million barrels), already 3 million barrels ahead of last year and far ahead of the10-year average of ~239 million barrels for the 2nd week of Jan."

Distillates also had a blow-out increase of 8.2 million barrels last week but even with that historic increase, we are still 3% below the five-year average for this time of year. That is lowering the fear factor surrounding the IMO rules for diesel, but still, we are not out of the woods. The EIA report in their Short Term Energy Outlook that January 1, 2020, the International Maritime Organization (IMO) enacted Annex VI of the International Convention for the Prevention of Pollution from Ships (MARPOL Convention), which lowers the maximum sulfur content of marine fuel oil used in ocean-going vessels from 3.5% of weight to 0.5%.

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5641 Re: Overcoming Incredible Builds .... wriskit 0 1/17/2020 1:55:15 PM

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