New crude oil data series

The EIA has prepared new takes as part of the semiannual Working and Net Available Shell Storage Capacity Report in an effort to better present crude oil storage capacity and use across the US. The new series show crude oil stocks held at refineries, crude oil in tanks and underground storage in each Petroleum Administration for Defence District (PADD). In the past, this information was only available at the national level.

Crude oil stocks in storage tanks and underground are used to calculate storage capacity utilisation rates and to derive the quantity of crude oil held in pipelines and in transit by rail and water. Refinery stocks and storage capacity data by PADD have both been available since 2011, but the new table brings together these two sets of data to simplify the task of calculating utilisation rates by PADD.

EIA updates

EIA updates storage capacity data twice a year and reflects capacities as of the end of March and September. EIA has crude oil inventory data back to 2981, however storage capacity data was first reported by the EIA for the end of March 2011. The EIA reports crude oil inventories held in four differing locations:

• Refineries.
• Pipelines and tank farms, further classified as tanks and underground storage and pipelines and other forms of transit.
• Producing leases.

All four of the above are considered when calculating inventories, however only two categories are relevant to calculating capacity utilisation: crude oil held at refineries and in tanks and underground storage. Some stocks reported as being held in refineries are actually in transit (in this instance on their way to the refinery), but these volumes are assumed to be minimal relative to stocks in refinery tanks and refinery storage capacity.

The Midwest

It has been noted by the EIA that some of the more significant changes in crude oil storage have occurred in the Midwest, where 26% of the nation’s working storage capacity, including storage at Cushing, Oklahoma, is located. Storage utilisation at Midwest refineries in March 2015 hit 80%, the highest storage utilisation rate observed for any month since the EIA commenced collecting storage capacity data. Again, the refinery storage utilisation rate may be somewhat overstated, as the refinery stock data includes volumes of crude oil in transit by rail and water being transported to refineries.

When it comes to crude oil stocks held in tank farms and pipelines, crude oil in transit by pipeline, water and rail can be separately tabulated. These volumes are not measured directly but rather are derived by subtracting the stocks in tanks and underground storage from the combined pipeline and tank farm quantity.

In the Midwest, stocks in pipelines and in transit by rail and water rose from 25.3 million bbls in March 2011 to 35 million bbls in March this year. This increase occurred mainly due to pipeline expansions and increased quantities of crude oil being transported by rail and water. Because pipelines must be full in order to operate, stocks held in pipelines are not considered in the storage utilisation circulation. Utilisation of working capacity of tanks and underground storage was 73% in March this year, almost equal to the rate in March 2011, as Midwest crude oil stocks and storage capacities increased at similar rates.

Utilisation of combined storage capacity at Midwest refineries and tank farms was 74% at the end of March this year, the highest PADD 2 storage capacity utilisation rate recorded in time EIA has been collecting data. In absolute amounts, the crude oil stored at Midwest refineries and tank farms in March 2015 was 103.7 million bbls, slightly lower than the total Midwest working storage capacity four years previously. Because storage capacity has increased, however, the March 2015 utilisation rate is only approximately 2% above the previous high of 72% at the end of March 2011.

Edited from press release by Claira Lloyd

Read the article online at: https://www.hydrocarbonengineering.com/refining/08062015/crude-oil-data-series/