Petroleum Update for Week Ending 3/3/06

[BoeingBoy]

It's another Wednesday.....

U.S. crude oil imports averaged over 10.1 million barrels per day last week, up 267,000 barrels per day from the previous week. Over the last four weeks, crude oil imports have averaged nearly 10.1 million barrels per day, a decrease of 46,000 barrels per day from the comparable four weeks last year.

U.S. commercial crude oil inventories (excluding those in the SPR) climbed by 6.8 million barrels from the previous week. At 335.1 million barrels, U.S. crude oil inventories are at the highest level since the end of May 1999, and remain well above the upper end of the average range for this time of year.

U.S. crude oil refinery inputs averaged nearly 14.1 million barrels per day during the week ending March 3, down 391,000 barrels per day from the previous week's average. Refineries operated at 83.0 percent of their operable capacity last week.

Total products supplied over the last four-week period has averaged over 20.7 million barrels per day, or 0.3 percent more than averaged over the same period last year. Jet fuel demand is down 4.6 percent over the last four weeks compared to the same four-week period last year.

Spot prices on 3/3/06:

NY Harbor Jet $1.9140/gal (up 12.35 cents WoW)
Gulf Coast Jet $1.9240/gal (up 11.47 cents WoW)
Los Angeles Jet $1.9400/gal (up 8 cents WoW)
WTI-Cushing Crude $63.61/bbl (up $2.15 WoW)

Bloomberg is reporting WTI-Cushing @ $60.25 as of 11:18am and NYMEX @ $60.45 as of 10:52am.

In related news, OPEC appears set to maintain their current quotas and not cut them, partially due to continuing reductions in Nigerian production.

Bloomberg Article

Finally, the chart of monthly average spot prices carried forward from last week's update:

View attachment 4583

Jim

 

[FWAAA]

Those are some fugly week over week increases in the spot price. Combined with last week's report, the East and Gulf coasts' price has jumped 19.5 cents; a little less on the West coast (although that price was already substantially higher than the other two). And with winter about over, we are now coming up on the driving season and heavy air travel seasons.

My prediction for July 1: JetA at $3.00/gal and oil at $90/bbl.

It's gonna get really ugly before it gets better.

 

[BoeingBoy]

FWIW, here's the 3/7/06 spot prices - the EIA "historical" tables include the prices up to the day before the weekly report is issued on Wednesday.

NY Harbor $1.8335/gal (up 4.30 cents from 2/24/06)
Gulf Coast $1.8040/gal (dn 0.52 cents from 2/24/06)
Los Angeles $1.8450/gal (dn 1.5 cents from 2/24/06)

Jim

 

[FWAAA]

Whew! My bad. Thanks for the accurate info.

Looks like it's dropped quite a bit this week so far. Still, it's quite expensive compared to the average for the past 20 years (and especially compared to the $0.55 average during 1998-99).

My Summer prediction still stands.

 

[imca85]

FWAAA


I would have to disagree with you, and this is just my opinion. I quit USair to work in the oilfield, and we are trying to get as much oil out of the ground as we possibly can to get that $ 50.00 oil. ( local price) The oil financial advisors are saying we're starting to get an oversupply of crude and the only thing keeping prices up at the moment is Chavez and Iran. I would predict $ 50.00 oil this summer. I could be wrong but right now business is good with $60.00 oil.

Here's a link to see what crude is going for in your area.

http://www.plainsallamerican.com/fw/main/d....asp?DocID=1363

Good luck to all.

 

[SoftLanding]

FWAAA
I would have to disagree with you, and this is just my opinion. I quit USair to work in the oilfield, and we are trying to get as much oil out of the ground as we possibly can to get that $ 50.00 oil. ( local price) The oil financial advisors are saying we're starting to get an oversupply of crude and the only thing keeping prices up at the moment is Chavez and Iran. I would predict $ 50.00 oil this summer. I could be wrong but right now business is good with $60.00 oil.

Good luck to all.

Agree, plenty of oil out there, though as you said Chavez and Iran are potential short term problems.

But, both are realists, they need the petro dollars, even though they talk tough...Also, the US is stretched way to thin to start something against Iran.

How long before we see 40 dollar oil?

 

[FWAAA]

FWAAA
I would have to disagree with you, and this is just my opinion. I quit USair to work in the oilfield, and we are trying to get as much oil out of the ground as we possibly can to get that $ 50.00 oil. ( local price) The oil financial advisors are saying we're starting to get an oversupply of crude and the only thing keeping prices up at the moment is Chavez and Iran. I would predict $ 50.00 oil this summer. I could be wrong but right now business is good with $60.00 oil.

You may very well be right, and I may be completely out to lunch. That's why I'm not buying oil or gasoline options right now; I'm unwilling to gamble real money that oil will actually hit $150 or $200/bbl. In fact, if I did, then sure, oil will fall to $35/bbl very quickly. 😀

Here's a link to a post I made a couple weeks ago explaining why I see oil going thru the roof in the future:

http://www.usaviation.com/forums/index.php...ndpost&p=357561

As 2.5 billion people (the populations of China, India and former USSR) begin consuming oil the way we have for many, many years, I see the price continuing to climb.

I may very well be wrong, but anyone can predict $40/bbl oil - that doesn't require anyone to stick their neck out very far. B)

 

[SoftLanding]

You may very well be right, and I may be completely out to lunch. That's why I'm not buying oil or gasoline options right now; I'm unwilling to gamble real money that oil will actually hit $150 or $200/bbl. In fact, if I did, then sure, oil will fall to $35/bbl very quickly. 😀

Here's a link to a post I made a couple weeks ago explaining why I see oil going thru the roof in the future:

http://www.usaviation.com/forums/index.php...ndpost&p=357561

As 2.5 billion people (the populations of China, India and former USSR) begin consuming oil the way we have for many, many years, I see the price continuing to climb.

I may very well be wrong, but anyone can predict $40/bbl oil - that doesn't require anyone to stick their neck out very far. B)

As can anyone predict 100 or up dollar oil, still doesn't require one's neck out very far.

I figure airline stock is a reasonable bet at this juncture, and have positioned myself so.

As far as oil usage by China, India etc., where's the beef? Look at the oil report, tells us all we need to know.

On top of that, higher interest rates usually cools the economy...

Now, obviously, Iran etc. is a potential problem. But those leaders are not fools. Don't you think they would have stopped their oil flows already if they wanted to "punish" the West? Again, the world is just about swimming in oil...😉

 

[SpinDoc]

As can anyone predict 100 or up dollar oil, still doesn't require one's neck out very far.

I figure airline stock is a reasonable bet at this juncture, and have positioned myself so.

As far as oil usage by China, India etc., where's the beef? Look at the oil report, tells us all we need to know.

On top of that, higher interest rates usually cools the economy...

Now, obviously, Iran etc. is a potential problem. But those leaders are not fools. Don't you think they would have stopped their oil flows already if they wanted to "punish" the West? Again, the world is just about swimming in oil...😉

Hey y'all:

It was quite gratifying to see the recent Congressional hearings on oil company price gouging. Last night on PMS NBC, Joe Scarborough made the oil company executives and their spokespeople look just like the greedy bastiches they protray in real life. I hope Congress is able to tame these greedy SOB's and bring gasoline and aviation fuel prices back to where they should be.

 

[autofixer]

They will just move their operations off shore (Maybe Dubai) and the situation will be even worse than it is now. Watch what you wish for, you just may get it.

 

[SpinDoc]

They will just move their operations off shore (Maybe Dubai) and the situation will be even worse than it is now. Watch what you wish for, you just may get it.

Auto:

I will watch what I wish for, but the reality of the situation is that Big Oil needs the U.S. more than it needs them. The U.S. is still the largest consumer of oil and refined petroleum products in the world, and they can't afford to turn their backs, even if Congress knocks them down a few pegs, which is definitely needed at this point.

There is no reason for oil to be more than $25/bbl, or for refined gasoline to cost more than $1.09 per gallon in the U.S. None at all. It's all market forces and irrational exhuberance from the futures markets. Just think about how much profit US Airways and the other carriers would be bringing in right now, if aviation fuel prices were in the least bit rational ($.69 to $.80 per gallon).

Just remember the next time you fill up your car. You're paying to finance the mergers of the 1990's which only served to consolidate and monopolize the oil industry and has permitted them to raise prices without inteference. Less competition has resulted in higher prices, and Congress, which permitted all of the mergers, is now having second thoughts and WILL find a way to reign in the current monopolies.

 

[imca85]

Hey spin dud

I think I need $ 25 tix to florida also but those greedy airlines are charging a lot more.