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Oil market recap: week ending 23rd February

Hydrocarbon Engineering,

According to PIRA Energy Group, ongoing growth of shale continues to dominate both oil and gas outlooks. Also, on the week US product stock draws resumed while Japanese commercial stocks drew sharply.


  • Even if a slowdown from the recent growth pace occurs, shale will remain a major contributor to global liquids growth and the US will still face a steady decline in import requirements.
  • There is continued and increasing violence in Iraq, significant outages in Libya coupled with political turmoil, sanctions and extremely uncertain negotiations with Iran, growing unrest in Venezuela, and an unending war in Syria that could spread violence anywhere in the Middle East.
  • Reports of the death of demand growth are premature due to the bounce back of global demand growth in 2013.


  • Commercial oil inventories drew with product stocks falling and crude building.
  • Sixth consecutive weekly product stock decline and fifth consecutive crude inventory build.
  • Crude inventories are forecast to decline next week as the Gulf Coast is faced with extended weather related delivery delays which will keep imports low.
  • Export cancellations and fog delayed shipping of propane from the USGC last week and there fore led to low stock draw.
  • Pace of propane inventory decline should pick up as new record low positions are going to be set.
  • Ethanol production margins improved significantly for the week ending 14th February due to higher ethanol values, table corn costs, and lower natural gas prices.


  • Commercial stocks were sharply lower by 8.6 million bpd due to a sharp drop in crude stocks and a much lower draw in finished products, which was mostly kerosene.
  • Gasoline and gasoil demands fell back slightly, and gasoline stocks built modestly, while gasoil stocks still were able to post a small draw on lower yield and higher incremental exports.
  • Kerosene demand perked up and the draw rate came in at its highest rate of the year.

Adapted from a press release by Claira Lloyd.

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