EIA reported a build of 718kbbls in crude after last week’s draw of -5.895Mbbls, gasoline dropped -3.1m bbl. Total oil and fuel exports dropped 1.5m b/d to 9.2m b/d, the lowest since August, production was 100kbbls lower. Implied gasoline demand (4-wk avg.) rose 250k b/d to 8.7m b/d. We saw -3.500Mbbls taken from the SPR into the crude oil market. US crude inventories fell by 2,778mb last week (commercial: +0.718mb, SPR: -3.105mb). SPR is the lowest level since 1983 down ~218.6Mbbls YTD. 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.
Oil prices back testing WTI 77 to $80bbl have seemingly ignored much of the negative morose from 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. Nevertheless, crude remains on track for the first back-to-back quarterly decline since 2019.
The geopolitical framework for Crude Oil remains volatile as Russia, Germany, Iran and China pursue 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. Geopolitical risks remain after 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 12/21/21
- Release Time: Thursday, December 28, 2022, at 11:00 A.M. (ET)
Highlights
- Crude EIA +0.718M Exp -1.17M Prior -5.895M API -1.300M
- Cushing EIA -0.200M Exp -0.173M Prior +0.853M API -0.338M
- Gasoline EIA -3.105M Exp -2.014M Prior +2.530M API +0.510M
- Distillate EIA +0.282M Exp +0.524M Prior -0.242M API +0.380M
- Refinery Utilization +1.1% to 92.0% Exp -0.9%
- Production -100kbbls at 12,000kbpd (13.10 ATH)
- SPR release -3.600 million barrels (Lowest Since March 1984)
Note in bbls *exp = Reuters poll estimates adjusted for API shift, except Cushing
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 -3.500Mbbls taken from the SPR into the crude oil market. US crude inventories fell by 2,778mb last week (commercial: +0.718mb, SPR: -3.105mb).
- SPR is down ~218.6Mbbls YTD.
- 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 +438 to 3504
- Mexico -51 to 581
- Saudi Arabia -40 to 473
- Colombia +282 to 353
- Iraq +62 to 289
- Ecuador +204 to 274
- Nigeria -70 to 66
- Brazil -76 to 40
- Libya -90 to 0
Exports
US petroleum exports new record high 11.776mbpd last week (crude 4.948mbpd, products 6.828mbpd) – EIA
US Gasoline Consumers
Input to Refineries
US consumers bought +391.7 million gallons of gasoline per day last week. That is -16.7 mil YoY.
US consumers spent $1,210.8 million dollars per day for gasoline last week. That is $-126.7 mil YoY
US avg retail price for gasoline was $3.091 last week. That is -0.184 YoY.
Rig Watch
Baker Hughes Weekly North American Rigs Report
- US Baker Hughes Rig Count 22-Dec: 779 (prev 776) ▲193y/y
- Rotary Gas Rigs: 155 (prev 154)
- Rotary Oil Rigs: 622 (est 622; prev 620) ▲142 y/y.
US Oil Rigs w/w changes by key shale basins
- Permian +2 to 349
- Eagle Ford unchanged at 66
- Williston +1 to 42
- Cana Woodford -1 to 28
- DJ Niobrara -1 to 18
US oil rigs and frac spread (Baker Hughes/Primary Vision)
Canada Rigs
- Canada Rotary Drilling Rigs 29 Oct 2022
- Of those rigs, 29% are drilling for natural gas, 56% are drilling for oil, 3% for other (helium, hydrogen, geothermal, lithium, or potash), and 12% are moving.
- Drilling activity by province is 72% in Alberta, 19% in Saskatchewan, 7% in BC, and 2% in Manitoba.
- Precision Drilling holds the majority of the Canadian market share with 30%, Ensign Drilling with 22%, Savanna Drilling with 12%, Horizon Drilling with 6%, and Stampede Drilling with 6%.
International oil rigs ex North America
International oil rigs ex North America +10 m/m to 694 in October (Baker Hughes)
- Oman +4
- Argentina +3
- Mexico +3
- Angola +2
- Algeria -3
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 12.00 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 10,140 contracts to 99,533 in the week ending December 20 via ICE
- Long-only positions rose by 2,525
- Short-only positions fell by 7,615
- other reportables net-length rose by 4,235
Money managers increased their net-length in WTI crude oil futures and options by 12,931 contracts to 188,583 in the week ending December 20 via CFTC
- Long-only positions fell by 1,843
- Short-only positions fell by 14,774
- other reportables net-length fell by 10,561
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 December 20
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 wk to Nov 15 saw speculators make major changes as the US dollar and yields dropped and recession risks rose. Crude oil soybeans corn and cattle sold with buying concentrated in gold copper sugar and cococa 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