PIRA Energy Group has said that Brent crude tightness will not last, in their opinion. In the US, crude build drives another recover total US commercial stock level and in Japan, crude runs eased and product stocks drew.
- PIRA’s outlook for an improving global economy is on track.
- Current Brent crude tightness will not last.
- The Atlantic Basin has no outlet for its excess crude, with Middle East producers aggressively pricing in Asia to maintain market share.
- The surplus hit Europe first, then North America, and now all prices point supply back to Europe.
- PIRA expects slightly lower supply disruptions in 2015 but believe that important risks are still lurking.
- Violence and political turmoil remain a threat, but this years risks are also emanating from the low oil price environment.
- PIRA believes the biggest risks to supply this year come from presidential elections in Nigeria; economic deterioration in Venezuela; and fiscal constraints and political tensions between Baghdad and Kurdistan.
- Crude balance structure has bloated crude inventories to record levels.
- Domestic crude supply is up more than 1.5 million bpd over the last four weeks.
- Crude imports remain high.
- Weekly crude runs and exports are up a combined 0.7 million bpd.
- Total commercial stocks built during the week, to a new record high.
- Year on year surplus increased.
- Ethanol production declined sharply during the week ending February 20.
- Inventories of ethanol built by 510 000 bbls to a 2.5 year high of 21.6 million bbls.
- Crude runs have begun to ease from maximum seasonal levels.
- Imports were low and crude stocks drew.
- Finished product stocks drew modestly.
- Gasoline demand eased, but stocks still drew slightly.
- Gasoil demand was strong and stocks drew for the fifth straight week.
- The indicative refining margin remained strong.
- Gasoline cracks firmed, while other major product cracks eased slightly.
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