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US crude stockpiles dip, gasoline builds amid weak fuel demand

October 23/2020

MOSCOW (MRC) -- US crude oil and distillate inventories fell last week, while gasoline stocks rose in another weak showing for fuel demand, reported Reuters with reference to the Energy Information Administration.

Refinery runs and crude production both fell sharply, however, which analysts attributed to ongoing disruptions from Hurricane Delta.

Crude inventories USOILC=ECI fell by 1 MM barrels in the week to Oct. 16 to 488.1 MM barrels, in line with analysts' expectations in a Reuters poll.

Production of crude fell sharply last week to 9.9 MMbpd from 10.5 MMbpd, which was in part due to offshore facilities shutting for part of the week due to the hurricane.

Overall the report seems to suggest that were still seeing the impact from the hurricane. Its hard to gauge any broader supply or demand issues, said Phil Flynn, senior analyst at Price Futures Group.

Prices were lower on the day, with US crude CLc1 down 4%, or USD1.30, to USD40.40 a barrel, while Brent LCOc1 dropped 2.8% to USD41.95 a barrel as of 10:54 a.m. ET (1454 GMT).

Overall product supplied, a proxy for demand, was lower as well, and remained down 13% on the year and over the past four weeks when compared with the year-ago period.

Refinery crude runs USOICR=ECI fell by 551,000 bpd in the last week, the EIA said, and refinery utilization rates USOIRU=ECI fell by 2.2 percentage points to 72.9% of capacity.

US gasoline stocks USOILG=ECI rose by 1.9 million barrels in the week, the EIA said, compared with expectations for a 1.8 million-barrel drop.

Distillate stockpiles USOILD=ECI, which include diesel and heating oil, fell by 3.8 MM barrels to 160.7 MM barrels, more than double the forecast for a 1.7 million-barrel drop, the EIA data showed.

As MRC wrote before, US crude stocks moved lower in the first week of October as Hurricane Delta shut in Gulf of Mexico output and exports hit a 14-month low, according to US Energy Information Administration data showed Oct. 15. US commercial crude stocks declined 3.82 million barrels in the week ended Oct. 9 to 489.11 million barrels, EIA data showed. The draw left inventories just 10% above the five-year average, the weakest supply overhang since mid-May.

We remind that in August, 2020, US refiner Phillips 66 said it plans to reconfigure its refinery in Rodeo, California to produce renewable fuels from used cooking oil, fats, greases and soybean oils.

We also remind that US-based Phillips 66 remains open to developing another ethane cracker for its Chevron Phillips Chemical (CP Chem) joint venture, the refiner's CEO said in March 2018.

Ethylene and propylene are feedstocks for producing polyethylene (PE) and polypropylene (PP).

According to MRC's ScanPlast report, Russia's overall PE production totalled 1,712,400 tonnes in the first seven months of 2020, up by 58% year on year. Linear low density polyethylene (LLDPE) accounted for the greatest increase in the output. At the same time, overall PP production in Russia increased in January-July 2020 by 24% year on year to 1,063,700 tonne. ZapSibNeftekhim accounted for the main increase in the output.


mrcplast.com
Author:Margaret Volkova
Tags:PP, PE, LLDPE, crude and gaz condensate, PP random copolymer, propylene, ethylene, petrochemistry, Chevron Phillips, Phillips 66, Russia, USA.
Category:General News
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