Petroleum Update for Week Ending 3/31/06

[BoeingBoy]

Crude Oil Inventories on 3/31/06 - 342.8 million bbls, up 2.1 million Wow (0.6%) & 24.5 million YoY (7.7%)

Domestic Crude Production 4 week average - 5.055 million bbls/day, down 443 thousand YoY (8.1%)

Net Imports 4 week average (imports less exports) - 9.810 million bbl/day, down 189 thousand YoY (1.9%)

Refinery Input 4 week average - 14,601,000 bbls/day, down 531 thousand (3.6%). Refinery Utilization averaged 85.9% for the week.

Jet Fuel Supplied (4 week average) - 1,617,000 bbls/day, up 3,000 YoY (0.2%)

Jet Fuel Stocks on 3/31/06:
Total Domestic - 41,900,000 bbls, down 5,000 WoW & up 4,000,000 YoY
- East Coast - 10,100,000 bbls (down 200,000 WoW)
- Midwest - 8,300,000 bbls (no change WoW)
- Gulf Coast - 12,800,000 bbls (down 200,000 WoW)
- Rocky Mountain - 700,000 bbls (no change WoW)
- West Coast - 10,100,000 bbls (up 100,000 WoW)

Jet Fuel Production 4 week average:
Total Domestic - 1,471,000 bbls/day (down 51,000 bbls WoW)
- East Coast - 98,000 bbls/day (down 6,000 bbls WoW)
- Midwest - 197,000 bbls/day (down 52,000 bbls WoW)
- Gulf Coast - 747,000 bbls/day (dn 3,000 bbls WoW)
- Rocky Mountain - 24,000 bbls/day (down 2,000 bbls WoW)
- West Coast - 405,000 bbls/day (up 12,000 bbls WoW)

Jet Fuel Imports (4 week avg):
Total Imports - 123,000 bbls/day (down 48,000 WoW)
- East Coast - 70,000 bbls/day (up 25,000 WoW)
- Midwest - 0 bbls/day (unchanged)
- Gulf Coast - 1,000 bbls/day (unchanged)
- Rocky Mountain - 0 bbls/day (unchanged)
- West Coast - 52,000 bbls/day (down 63,000 WoW)

Spot prices on 3/10/06:
NY Harbor Jet - $2.0120/gal (up 5.90 cents WoW)
Gulf Coast Jet - $1.9500/gal (up 6.85 cents WoW)
Los Angeles Jet - $1.9525/gal (up 5.75 cents WoW)
WTI-Cushing Crude - $66.25/bbl (up $2.35 WoW)

Bloomberg is showing WTI-Cushing at $66.90 @ noon.

With this week's report, March average spot prices are available and included in the chart.

View attachment 4735

Jim

 

[FWAAA]

And the price just keeps on going up. May crude futures closed up at $67.07/bbl.

A couple weeks ago, AirTran announced that its First Quarter price for fuel (all-in price, including delivery, net of hedging gains, etc) was expected to be $2.10 to $2.15/gal. Current rack-rate price must be somewhere around $2.25/gal.

Despite all the rosy accolades and predictions made by US and UA upon their emergence from bankruptcy, their borrowed nest eggs are being eaten away at the gas pump. If this keeps up for the long-term, both will eventually be looking for some new loans, if not using the federal Bankruptcy Code yet again to trim some of their old loans.

Profits? I don't see any on the horizon.

 

[SoftLanding]

And the price just keeps on going up. May crude futures closed up at $67.07/bbl.

A couple weeks ago, AirTran announced that its First Quarter price for fuel (all-in price, including delivery, net of hedging gains, etc) was expected to be $2.10 to $2.15/gal. Current rack-rate price must be somewhere around $2.25/gal.

Despite all the rosy accolades and predictions made by US and UA upon their emergence from bankruptcy, their borrowed nest eggs are being eaten away at the gas pump. If this keeps up for the long-term, both will eventually be looking for some new loans, if not using the federal Bankruptcy Code yet again to trim some of their old loans.

Profits? I don't see any on the horizon.

FWAAA,

1st quarter 2006 results will certainly be interesting to watch, and we'll know in a few weeks time.

Have the fare increases covered $65'ish oil? Were management smart/lucky enough to hedge a little in mid-Feb? Here's to hoping for the oil rally from the Feb's lows
to fail...

Looking forward to he conf calls...

Parker is looking for roughly $600 Millions in savings with the merger...buys a few gallons...

 

[BoeingBoy]

Just a note for those few who really read these reports - I'm working Mon-Thu this week & next so the updates will be a day late.

Jim

 

[allegheny37]

Just a note for those few who really read these reports - I'm working Mon-Thu this week & next so the updates will be a day late.

Jim

Thanks Jim
I appreciate all the time you take to put out these reports.

 

[autofixer]

I am not trying to fill in for Jim, I am just interested for various reasons in these things:

There is some bad news on the distillant front today. Although crude inventories were up 3+billion barrels, gasoline inventroies were down nearly 4 billion barrels (On high demand) and distillants (Jet fuel is in here) were down over 3 billion barrels on demand (AIE Inventory report for last week). Look for jet fuel prices to jump as well a gasoline to continue to rise as Summer demand increases.

Even though there is NO oil shortage, there IS a refining shortage. This is due to political considerations in decades past--this is the man behind the curtain "manipulating" gasoline prices. Demand must come down (Which will naturally occur as prices increase; however, what damage will be done to the economy?) and production must increase (More refining capacity must come on line. This takes years and will not likley happen due to politcal and regulatory considerations in the US. Perhaps capacity will continue to grow in the developing world and we can continue to import distillants at a premium--as we are now.).


http://money.aol.com/news/articles?id=n20060412104909990025

http://finance.myway.com/jsp/nw/nwdt_rt.js...s_id=ap-d8guh0h

http://news.moneycentral.msn.com/provider/...0412&ID=5637998

 

[FWAAA]

Today (Thursday), oil appears to be falling rapidly - as all airline stocks are rallying.

 

[autofixer]

Watch distillates (Jet fuel and gasoline) not oil. There is not enough production capacity to turn the oil into gas and jet fuel.

 

[FWAAA]

Watch distillates (Jet fuel and gasoline) not oil. There is not enough production capacity to turn the oil into gas and jet fuel.

I agree with you completely, but the price of legacy airline stocks seems to move inversely to crude prices. Makes some sense since the refining capacity shortage (or lack of excess capacity) is a constant, and crude oil price movements do affect the retail price for JetA. Today, for example, CAL and AMR are both down about 6% right now on higher crude prices.