EIA reported a build of +18.161Mbbls in crude last week, US crude inventories rose by 18.161Mbbls last week (commercial: +18.961Mbbls; SPR: -0.8Mbbls). The private API reported a massive 14.865Mbbl build prior which the market has largely dismissed as the result of either missed data collection or refinery downtime due to the freezing weather event. Gasoline added 4.114M bbl. Refinery utilization rose just +4.5% still well under the fell 12.4% for the week ending 12/31 due to arctic freeze. US total crude oil inventories (both commercial and the Strategic Petroleum Reserve) had fallen to a 36-year low, dropping below the previous bottom set in 2001.
US benchmark crude oil futures volatility continues after having have sold off since the start of 2023 to under $74bbl to close down 8% last week, after WTI oil futures closed the year at $80.56bbl, up 7.62% for 2022, well off those Ukranian invasion highs around $130 but at a level that producers and consumers appear to be comfortable with. The negative morose from China’s economic implosion and the Central Bank maelstrom continuing to roil market sentiment as risks of global recession threaten the demand picture with higher rates pushing the likelihood of a meaningful recession higher. In 2023 the market has in the background the obtuse geopolitical framework framed by Russia’s Ukraine invasion, Germany’s inept energy policy, and Iran and China pursuing aggressive directions.
Germany in an attempt to achieve some energy independence seized the German unit of Russian oil major Rosneft PJSC a few months ago. Readdressing the dependance to Russia and the disaster that has come since the Ukraine invasion has been a slow and indecisive one by Germany. President Vladimir Putin said Russia would immediately stop oil supply to countries that support the G7 members price cap on exports of Russian oil.
Around The Barrel Contents
Click on the links below to navigate to the relevant section.
- DOE & API Petroleum Storage Forecast Matrix
- Crude Oil Quick Summary
- Weekly DoE US Petroleum Storage Report Breakdown
- API Crude Inventories
- Cushing Oil Stocks
- Crude Imports
- Crude Exports
- Gasoline
- Rig Watch
- Crude Oil Production
- Weather
- WTI Crude Oil Futures Technical Analysis
- DCOT Report
- Option Volatility and Gamma
- Key EIA and CME Dates
The soaring US dollar has had a significant impact on commodity futures, however under the engine demand and supply issues are the underlying guide.
DOE Weekly Petroleum Status Report Forecast
- via TradersCommunity.com
- Report Date 1/5/23
- Release Time: Wednesday, January 11, 2023, at 10:30 A.M. (ET)
Highlights
- Crude EIA +18.961M Exp -1.17M Prior +1.694 API +14.865M
- Cushing EIA +2.511M Exp +2.273M Prior +0.244M API +2.300M
- Gasoline EIA +4.114M Exp -2.014M Prior -0.346M API +1.800M
- Distillate EIA -1.069 Exp +0.524M Prior -1.427M API +1.100M
- Refinery Utilization +4.5%% to 84.1% Exp +4.9%
- Production +100kbbls at 12,200kbpd (13.10 ATH)
- SPR release -0.800 million barrels (Lowest Since 1983)
Note in bbls *exp = Reuters poll estimates adjusted for API shift, except Cushing
Final 2022 Inventory
- Commercial crude oil inventories were up ~2.8m bbls
- SPR inventories were down ~ 221.3m bbls
- Gasoline inventories were down ~10.1m bbls
- Distillates were down ~6.5m bbls
- Jet Fuel inventories were down ~0.9m bbls
- Propane was up ~14.5m bbls
Energy Price Matrix
Update: PADD 3 Refinery Utilization
US Crude Oil Quick Look
Oil prices continue to be subject to geopolitical bifurcation dynamics with sudden changes that accompanies the onset of chaos. The unexpected knock-ons continue with imperfect bifurcation with political influence and personal vagaries from world leaders such as Putin, Scholz and Biden in addition to routine crude dynamics.
via Giovanni Staunovo? @staunovo
Weekly DoE US Petroleum Storage Report Breakdown
Weekly Storage via DOE
with RonH Data @Ronh and The Fundamental Angle @BrynneKKelly
Via RonH at Ron H Public Tableau Link
The Fundamental Angle with Brynne Kelly @BrynneKKelly
API Crude Oil Inventories
US petroleum (Crude, SPR, oil products) inventories in million barrels (EIA)
US total crude oil inventories (both commercial and the Strategic Petroleum Reserve) have fallen to a 36-year low, dropping below the previous bottom set in 2001 via Bloomberg
- US crude stocks In SPR fell to lowest since Dec 1983.
- We saw -0.800Mbbls taken from the SPR into the crude oil market.
- US crude inventories rose by 18.161Mbbls last week (commercial: +18.961Mbbls; SPR: -0.8Mbbls).
- US total crude oil inventories (both commercial and the Strategic Petroleum Reserve) have fallen to a 36-year low, dropping below the previous bottom set in 2001.
Cushing Oil Stocks
Cushing, OK is the hub for the most heavily traded US oil Futures contract – West Intermediate Crude – WTI so for that reason we pay special attention to the storage there.
API Cushing Stocks
Weekly Update via RonH Data @Ronh999
Closer Look at Cushing with DigStic Data @DigStic
US Oil Import Export
Imports
US crude imports by origin in kbpd (incl w/w change)
- Canada +788 to 3737
- Mexico +240 to 668
- Saudi Arabia -15 to 464
- Colombia -111 to 246
- Iraq -204 to 150
- Ecuador +50 to 137
- Nigeria +2 to 143
- Brazil -87 to 132
- Libya -90 to 0
Exports
US petroleum exports new record high 11.776mbpd in December (crude 4.948mbpd, products 6.828mbpd) – EIA
Top buyers of US crude in October in kbpd (total exports 4.146mbpd)
- India 509
- South Korea 430
- UK 401
- Netherland 413
- Canada 383
- Singapore 346
- China 332
- Italy 187
- Germany 164
- Taiwan 135
- Spain 117
US Gasoline Consumers
Input to Refineries
US consumers bought 317.4 million gallons of gasoline per day last week. That is -14.6 mil YoY
US consumers spent $1,034.5 million dollars per day for gasoline last week. That is $-59.6 mil YoY.
US avg retail price for gasoline was $3.259 last week. That is -0.036 YoY.
Rig Watch
Baker Hughes Weekly North American Rigs Report
- US Baker Hughes Rig Count 06-Jan: 618 (est 623; prev 621)
- Rotary Gas Rigs: 152 (prev 156) – Rotary Oil Rigs: 772 (prev 779)
US Oil Rigs w/w changes by key shale basins
- Permian +1 to 350
- Eagle Ford unchanged at 66
- Williston unchanged at 42
- Cana Woodford -2 to 26
- DJ Niobrara -1 to 17
US oil rigs and frac spread (Baker Hughes/Primary Vision)
Canada Rigs
- Canada Rotary Drilling Rigs 16 Dec 2022
- Canada averaged 199 active drilling rigs this week according to data from the Canadian Association of Energy Contractors.
- Of those rigs, 33% are drilling for natural gas, 55% are drilling for oil, 5% for other (helium, hydrogen, geothermal, lithium, or potash), and 7% are moving. Drilling activity by province is 77% in Alberta, 12% in Saskatchewan, 9% in BC, and 2% in Manitoba.
- Precision Drilling holds the majority of the Canadian market share with 34%, Ensign Drilling with 22%, Savanna Drilling with 9%, Stampede Drilling with 7%, Horizon Drilling with 6%, and Bonanza Drilling with 5%.29dk2902l
- Canadian data should decline into year-end due to the holiday season for field staff (maybe down to 50 rigs or less).
International oil rigs ex North America
International oil rigs ex North America -12:m/m to 689 in December
- Algeria +4
- Turkey +3
- Abu Dhabi +3
- Nigeria +2
- Saudi Arabia -2
- Argentina -2
- Ecuador -2
- Mexico -3
- India -3
- Kuwait -4
- Indonesia -4
US Oil Production
US crude production changed benchmark September 14, 2022: This week’s domestic crude oil production estimate incorporates a re-benchmarking that lowered estimated volumes by 212,000 barrels per day, which is about 1.7% of this week’s estimated production total. EIA
US Oil Field Production +100 kbpd 12.20 mbpd (New Benchmark adj)
OPEC Crude Oil Production
OPEC crude oil production fell by 1m b/d to 28.8m b/d last month according to a survey from Bloomberg. Led by the four Gulf producers that needed to cut according to lower baselines. Overall, the 10 producers with quotas pumped around 1m b/d below the collective target via @Ole_S_Hansen – Bloomberg Survey
Weather Watch
Gulf of Mexico
WTI Crude Oil Futures Technical Analysis
via KnovaWave @KnovaWave
US Crude Oil (WTI)
Daily: WTI Crude Oil still chopping after completing the correction in 3 waves, C at the breakup level broke out of its daily bull flag through tenkan, kijun and 50dma right to the bottom of the cloud such was the impulse. From there it has been held back & needs to break above those descending levels for higher. We are in a completive mode for bulls with this impulse, it’s a question of degree on the topside, use the Murrey math 240/60 grid. From there down in 3 waves, completing a C or IV? Support is previous lows and the bull flag. The bear case is the high was a complete 5.
Weekly: WTI crude Oil futures spat the key 61.8% last month with impulse, having plunged more than 30% off the June highs. It has however been stuck in its sphere of influence since other than a peek this week. WTI completed 3 waves and powered through the tenkan and 50wma, however they both failed to hold the retest. Risk support is the grid. Long term 61.8% target fueled the spit of a spit by ABC bull flag after rebalanced Chikou sated. Resistance Weekly Kijun, cloud and Murrey Math levels and previous breaks (off monthly). Bear case is Wave 5 complete.
The key is crowd behavior to help tell the story which in energy is often around geopolitics. A great example of why we watch ABC corrections and from here we get the energy from the break being balanced. This move that was powered by 50 dma Tenkan spit of a spit – hence the fractal energies reverberations.
These are special times, recall “After we regained the pattern 261.8% from the extreme (-$40) move. The climax of the larger acceleration lower after broke the weekly uptrend, a fractal of the sharp and all the way to all-time lows to negative pricing we have seen mirror replications.” Above we have Murrey Math time and price
What we broke…….
Crude Oil in the past quarter built a huge bull flag. We watch if the recent break was false, or we fail. Very clear pattern.
The focus remains 85.61-88.01 a region defined by the 2013 low, the 100% extension of the March decline and the 61.8.% retracement of the November advance. A break below opens up the objective 2020 yearly open and 2018 high at 75.35-76.87. This would become an area of interest for downside exhaustion and price inflection potentially. Initial weekly the 38.2% Fibonacci retracement of the June decline at 100.21. Broader bearish invalidation now lowered to the June high-week close / 61.8% retracement at 109.16-110
Crude Oil Futures Commitment of Traders
Latest ICE and CFTC Open Interest Data:
CTFC and ICE open interest:
Money managers increased their net-length in Brent crude oil futures and options by 17,753 contracts to 161,456 in the week ending January 3 via ICE
- Long-only positions rose by 16,047
- Short-only positions fell by 1,706
- other reportables net-length fell by 14,829
Money managers increased their net-length in WTI crude oil futures and options by 29,923 contracts to 165,486 in the week ending January 3 via CFTC
- Long-only positions fell by 10,289
- Short-only positions rose by 19,634
- other reportables net-length rose by 7,942
Chart: Crude net-positioning of non-commercial accounts (=managed money and other reportables) in barrels and in US dollars (Brent and WTI futures and options combined) latest value is Jan 3, 2023
COT on Commodities
Specs lowered bullish crude oil bets by a comb. 52k lots to 400k, on a combination of long liquidation (-39k) and fresh short selling (+13k). All three fuel products also sold as the s/t demand outlook showed signs of softening
Money managers in commodities covering the week to Dec 27: Hedge funds went on a buying spree ahead of year end with broad demand lifting the comb long on 24 major futures contracts to a six-month high. Led by crudeoil (+51k) gold (+9k) and corn (+46k). Brent saw biggest jump in 17 mths via Ole S Hansen @Ole_S_Hansen
via Ole S Hansen @Ole_S_Hansen
Understanding DCOT Reports
Read Understanding Commitments of Traders Reports – COT, TFF and DCOT to help understand the disaggregated reports (DCOT) and how they break down the reportable open interest positions into four classifications:
1. Producer/Merchant/Processor/User 2. Swap Dealers 3. Managed Money 4. Other Reportables
Crude Oil Option Volatility Watch
via commodityvol.com
NYMEX LO = Crude Oil Options First 3 Months (Live Link)
NYMEX LO & ICE North Sea Brent BRN Crude Oil Options (Live Link)
NYMEX LO NYMEX OH NYMEX OB Options (Live Link)
NYMEX LO NYMEX OB Options (Live Link)
Energy Earnings Highlights for Q3 2022
Energy earning season saw increased production and earnings with improved North American and international markets for drilling, completion, and production. In Q3 we saw big oil reporting bumper third quarter profits as the US heads into Midterm elections. We now have had US Majors Oil giant Exxon Mobil posted a record profit, Chevron also posted a near record profit and Refiner Phillips 66 booked $5.4 billion in gains compared with $402 million during the same period last year. European majors, Shell, Europe’s largest oil company reported profits of $9.45 billion and British oil major BP PLC reported $8.2bn in earnings.
Key EIA and CME Dates for WTI Crude Oil
Key EIA and CME Dates For WTI Crude Oil
From The TradersCommunity US Research Desk