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U.S. crude output, refining use slump on Texas storms

February 25/2021

MOSCOW (MRC) -- U.S. crude oil production dropped by more than 1 million barrels per day last week during Texas's deep freeze, equaling the largest weekly fall ever, and refining use also fell dramatically, the Energy Information Administration said, said Hydrocarbonprocessing.

Overall output fell by 1.1 million bpd to 9.7 million bpd in the week to Feb. 19, the EIA said, as the brutal cold forced most of the state's power grid offline, and oil operators and refiners were forced to shut as components and pipelines froze. Some analysts had estimated far higher figures for production declines.

Refinery crude runs fell by 2.6 million bpd in the week, EIA said, and refinery utilization rates fell by 14.5% in the week as numerous facilities along the Gulf Coast shut in. Many of those operations are now restarting, though analysts say it will take a few weeks before both refining and production reaches pre-storm levels.

Its my understanding as Ive talked to CEOs and operators that most folks are back online," said Ben Shepperd, president of the Permian Basin Petroleum Association. Crude inventories rose by 1.3 million barrels in the week to 463 million barrels, compared with analysts' expectations in a Reuters poll for a 5.2 million-barrel drop.

Crude stocks at the Cushing, Oklahoma, delivery hub rose by 2.8 million barrels, and net U.S. crude imports rose by 249,000 bpd, the EIA said. U.S. gasoline stocks rose by 12,000 barrels to 257.1 million barrels, compared with expectations for a 3.1 million-barrel drop.?

Distillate stockpiles, which include diesel and heating oil, fell by 5 million barrels in the week to 152.7 million barrels, versus expectations for a 3.7 million-barrel drop, the EIA data showed.

U.S. crude stockpiles fell more than expected in the week to Feb. 12, before the freeze, with inventories down by 7.3 million barrels to 461.8 million barrels, their lowest since March, the Energy Information Administration reported on Thursday.

As per MRC, a winter storm has brought unusually cold temperatures, snow, and freezing rain to Texas and western Louisiana, forcing a large share of US light olefins production offline. As of the evening of Tuesday, 16 February, IHS Markit had confirmed the shutdown of at least 61% of US ethylene capacity, 59% of US chemical- and polymer-grade propylene (CGP, PGP) capacity, and 22% of US fluid catalytic cracking (FCC) capacity. Many plants that remained online were running at reduced capacity.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 2,220,640 tonnes in 2020, up by 2% year on year. Only shipments of low density polyethylene (LDPE) and high density polyethylene (HDPE) increased. At the same time, polypropylene (PP) shipments to the Russian market reached 1 240,000 tonnes in 2020 (calculated using the formula: production, minus exports, plus imports, excluding producers' inventories as of 1 January, 2020). Supply of exclusively PP random copolymer increased.
Author:Anna Larionova
Tags:petroleum products, crude oil, PP, PE, neftegaz, petrochemistry, Russia, USA.
Category:General News
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