Oil market recap: Week ending 12th January 2014

PIRA Energy Group’s analysis of oil market fundamentals for the week ending 12^th January 2014 has revealed the following:

US

Crude oil fundamentals improved throughout the Midcontinent in December, with stocks declining at Cushing, Patoka, West Texas, the Rockies, Western Canada and the Gulf Coast.

Product stocks

• Production impacts due to cold weather are likely to be severe in the oilsands of Alberta and rural areas of North Dakota. Weather is also affecting truck and rail deliveries.
• Total commercial inventories increased over the past week, with a decline in crude oil more than offset by an increase in products. Meanwhile, crude runs remain high.
• Reported demand was down, largely due to the New Year’s holiday.
• Stocks built on figures for the same week last year, so the year on year stock deficit widened.

Ethanol

• Ethanol prices fell the week ending 27^th December, due to reduced demand for gasoline blending.
• Ethanol inventories in PADD 2 were the highest since May.
• US ethanol production commenced the year with a rise to 919 000 bpd from 913 000 bpd.
• The manufacture of ethanol blended gasoline decreased for the second consecutive week, having reached a record 8.856 million bpd during the week ending 20^th December 2013.

Japan

• Japan experienced a sharp drop in crude stocks and relatively weak demands to start 2014. This has led to a strong build in finished product stocks.
• The overall balance in total commercial stocks rose 1.1 million bbls from end of December figures.
• Data is expected to normalise over the next week or so, with demand rebounding for all major products.

Read the article online at: https://www.hydrocarbonengineering.com/gas-processing/14012014/pira_energy_group_oil_market_recap_52/