U.S. refinery capacity sets new record as of January 1, 2019 (6/26/2019)

From January 1, 2018, to January 1, 2019, U.S. operable atmospheric crude oil distillation capacity increased 1.1%, reaching a record high of 18.8 million barrels per calendar day (b/cd), according to the U.S. Energy Information Administration’s (EIA) annual Refinery Capacity Report (Figure 1). The previous peak for the first day of the year came in 1981, when operable capacity reached 18.6 million b/cd, just slightly higher than on January 1, 2018. U.S. operable crude oil distillation unit (CDU) capacity has increased slightly in six of the past seven years. Operable capacity includes both idle and operating capacity. ... More »

Despite crude oil production cuts, Saudi Arabian crude oil exports to some Asian countries have increased (6/19/2019)

The U.S. Energy Information Administration (EIA) estimates that during May 2019, Saudi Arabia’s crude oil production approached a four-year low, averaging an estimated 9.9 million barrels per day (b/d). Production declined more than 1 million b/d since its estimated all-time high production levels in October and November 2018. Although the country’s total crude oil exports are also lower than recent highs, its crude oil exports to some Asia Pacific countries actually increased during the period of declining production. China in particular has increased its crude oil imports from Saudi Arabia, which is partially a result of new Chinese refining capacity. In contrast, U.S. crude oil imports from Saudi Arabia reached a 31-year low in February, with weekly estimates for April, May, and June suggesting even further declines.. ... More »

EIA forecasts lower crude oil prices, but expected inventory declines present considerable uncertainty (6/12/2019)

In the June 2019 Short-Term Energy Outlook (STEO), the U.S. Energy Information Administration (EIA) forecasts that Brent crude oil prices will average $67 per barrel (b) in 2019 and in 2020. EIA expects that West Texas Intermediate (WTI) crude oil prices will average $59/b in 2019 and $63/b in 2020. In the June STEO, EIA forecasts Brent and WTI prices in 2019 will be $3/b and $4/b lower, respectively, than forecast in the May 2019 STEO, and the 2020 crude oil price forecasts are unchanged. The lower 2019 price forecasts reflect recent price declines in global crude oil prices, which lowered the starting point for EIA’s forecast. However, the forecast is highly uncertain, however, as reflected in high implied volatility for crude oil options, which EIA uses to inform a market-derived confidence interval of price ranges (Figure 1). Recent data for a variety of oil market indicators—macroeconomic and global oil demand growth, liquid fuels stock levels, refinery runs, production from members of the Organization of the Petroleum Exporting Countries (OPEC), and the effect of tariffs—point to continued price uncertainty. ... More »

Lowest crude oil imports since 1986 indicate changes in U.S. Gulf Coast crude oil supply (6/5/2019)

U.S. Gulf Coast crude oil imports averaged 1.8 million barrels per day (b/d) in March 2019, the lowest level since March 1986 and significantly lower than the peak of 6.6 million b/d in March 2007. Preliminary weekly data indicate that Gulf Coast crude oil imports have averaged about 1.9 million b/d through April and May. Falling crude oil imports into the U.S. Gulf Coast so far in 2019 are the result of both recent events and continuing longer-term trends. Recently, sanctions on Venezuelan imports and heavy refinery maintenance have reduced imports. At the same time, imports to the Gulf Coast have also decreased because of sharp declines in imports from the Organization of the Petroleum Exporting Countries (OPEC) following an agreement among members to reduce production and because imports are being replaced by increased production of domestic crude oil. Together, these trends have fundamentally changed how the Gulf Coast region is supplied with crude oil. In the past five consecutive months, the U.S. Gulf Coast has exported more crude oil than it imported (net exports), and since 2015, it has consistently received more crude oil from other regions of the United States than it has sent to other regions (net receipts). ... More »

Oil company finding costs reached a 10-year low in 2018 (5/30/2019)

In 2018, a group of the world's largest crude oil and natural gas producers added more hydrocarbons to their resource base than in any year since at least 2009, according to the annual reports of 116 exploration and production (E&P) companies. During 2018, these companies collectively added a net 10.3 billion barrels of oil equivalent (BOE) to their proved reserves, which totaled 286 billion BOE at the end of the year. Total exploration and development (E&D) costs incurred in 2018 for these companies increased 4% from 2017 levels, but declined 9% from 2017 when calculated as dollars per BOE of proved reserves added. This analysis is based on published financial reports of these 116 companies and does not necessarily represent the financial situation of private companies that do not publish financial reports. ... More »