S&P Global Platts Preview of U.S. EIA Data: Likely to Show Crude Oil Stocks Fell 425,000 Barrels

A likely draw last week of U.S. stocks of crude oil, gasoline and distillates would represent the first across-the-board decline since the week ending July 28, likely sending a bullish message to traders that could nudge oil futures higher, according to an S&P Global Platts preview of this week's pending U.S. Energy Information Administration (EIA) oil stocks data. 

Survey of Analysts Results: 

(The below may be attributed to the S&P Global Platts survey of analysts) 

·        Crude stocks expected to show a drawdown of 425,000 barrels 

·        Gasoline stocks expected to fall 2.3 million barrels 

·        Distillate stocks expected to drop 2.05 million barrels 

·        Refinery utilization expected to rise 1.3 percentage points 

S&P Global Platts Analysis: 

(The below may be quoted in part or full, with attribution to S&P Global Platts Oil Futures Editor Geoffrey Craig)  

One reason why crude futures have been stuck around $50-$52/b over the last month has been the mixed signals coming from U.S. Energy Information Administration inventory data. 

U.S. crude oil stocks have fallen eight of the last 11 reporting periods, but not once during that stretch have crude, gasoline and distillate stocks all declined the same week, according to the EIA data. 

Analysts surveyed Monday by S&P Global Platts are looking for a crude draw of 425,000 barrels, while gasoline and distillates are expected to have declined 2.3 million barrels and 2.05 million barrels. 

If confirmed, that would help offset the bearish pressure stemming from EIA data the week prior that showed builds in gasoline and distillate stocks, despite a plunge in refinery activity. 

U.S. refinery utilization dropped 4.7 percentage points to 84.5% the week ending October 13, partly driven by disruptions in Gulf Coast activity because of Hurricane Nate. 

Without any known structural damage, analysts expect the utilization rate rebounded 1.3 percentage points last week to 85.8% of capacity. By comparison, the run rate a year ago equaled 85.6%. 

This time of year typically marks the depth of the autumn maintenance period, but that schedule was delayed by the devastation from Hurricane Harvey, which severely hit U.S. Gulf Coast (USGC) refining capacity in late August. 

The loss of product supply because of Harvey also lifted refining margins, creating an incentive for facilities to delay maintenance which in turn kept utilization rates elevated. 

For example, U.S. Atlantic Coast (USAC) refining margins using Saudi Arab Light averaged $10.42/b in the third quarter, up from $6.75/b the previous quarter and $7.41/b during Q3 2016. 

USGC margins using Arab Light averaged $9.05/b from July through September, versus $5.82/b in the second quarter and $5.60/b Q3 2016. 

Margins for Midwest refiners using mixed light sour crude jumped from $6.93/b in Q2 to $11.21/b in Q3, versus $6.13/b in the third quarter of 2016. 

S&P Global Platts margin data reflects the difference between a crude's netback and its spot price. Netbacks are based on crude yields, which are calculated by applying S&P Global Platts product price assessments to yield formulas designed by Turner, Mason & Co. 


In the Midwest, the decision to delay maintenance means that planned repairs have coincided with the region's peak demand season when the agricultural sector requires more fuel to harvest crops. 

This has exacerbated draws in Midwest product stocks that have strengthened prices in the physical market and kept margins aloft. 

After five straight weekly declines, Midwest stocks of low and ultra-low sulfur diesel equal 27.9 million barrels, the lowest level since December 2015 and nearly on par with the five-year average. 

As a result, the Chicago ULSD market has strengthened sharply, with differentials Friday at NYMEX November ULSD plus 16.75 cents/gal, the most since November 2015, according to S&P Global Platts assessments. 

The arbitrage for shipping diesel from the Gulf Coast to Chicago reopened September 25 after being shut for a month, and has continued to improve since then, according to U.S. Global Platts calculations. 

Assuming a cost of 6.25 cents/gal for transportation and fees, Chicago ULSD stood 15.48 cents/gal above the Gulf Coast market Friday, the largest gap since November 2, 2015. 

The transit time from the Gulf Coast to Chicago has kept the region tight even with the arbitrage open on paper, market sources say. 


Falling gasoline stocks in the Midwest have also been supportive for the Chicago CBOB market, which was assessed Friday at NYMEX November RBOB* plus 15 cents/gal, the largest differential since August 30. 

Midwest gasoline stocks have drawn seven of the last eight weeks to 48.3 million barrels, which is nearly even with the five-year average and the fewest since November 2016. 

On the Atlantic Coast, gasoline stocks have recouped from the post-Harvey low point in mid-September when inventories fell to 53.4 million barrels. 

USAC inventories equaled 57.9 million barrels the week ending October 13, a surplus of 3.9% to the five-year average. 

That said, one factor keeping a lid on stocks in the region has been modest import levels, as European gasoline supply has gravitated toward the more profitable West Africa market. 

USAC gasoline imports from Europe totaled 3.7 million barrels from October 1-13, versus 6.39 million b/d during the same period a year ago, according to U.S. Customs data. 

In September, USAC gasoline imports totaled 7 million barrels, the lowest monthly total since March. 

Reduced demand for shipping gasoline from Northwest Europe to the USAC has also pushed clean freight rates for Medium Range tankers to their lowest levels so far this year. 

The U.K. Continent-U.S. Atlantic Coast route, basis 37,000 metric tons (mt), fell w2.5 from Thursday to Worldscale 97.5 on Friday. It was the first time this year the rate has moved below w100. 

For more information on crude oil, visit the S&P Global Platts website. 

* Reformulated blend stock for oxygenate blending (RBOB) futures contract, the biggest premium to the front-month contract since late August. 


Global, Americas, Asia: Kathleen Tanzy, + 1 917 331 4607, 

About S&P Global Platts 

At S&P Global Platts, we provide the insights; you make better informed trading and business decisions with confidence. We're the leading independent provider of information and benchmark prices for the commodities and energy markets. Customers in over 150 countries look to our expertise in news, pricing and analytics to deliver greater transparency and efficiency to markets. S&P Global Platts coverage includes oil and gas, power, petrochemicals, metals, agriculture and shipping. 

S&P Global Platts is a division of S&P Global (NYSE: SPGI), which provides essential intelligence for individuals, companies and governments to make decisions with confidence. For more information, visit 

New service from OilVoice
Trip Shepherd is for companies who need to track their staff in areas of risk.
It's free to use, so we invite you to try it.

Visit source site

S&P Global PlattsEIAEnergy Information Administration EIACrude oilStocksUnited StatesDiesel

More items from oilvoice

Cyber Security Experts Unite to Protect Europe’s Critical Industries

CS4CA Summit Returns to London this October Staying abreast of fast-paced industry developments is crucial for cyber security professionals. And while one can learn a lot from publications and social media, it's hard to beat the value of insights gained first-hand from peers. This is why 150+ IT ...

OilVoice Press - OilVoice

Posted 8 months agoPress > cybereurope

Africa E&P Summit

The organisers of the Africa E&P Summit are bringing together Africa's leading exploration companies and governments, just one of the many reasons why you should be attending frontier's event that they are organising and hosting in London at the IET: Savoy Place, 22-23 May. Over 200 key senior exec ...

OilVoice Press - OilVoice

Posted 1 year agoPress > Africasummitoil summit +2

Equinor Deepens in Offshore Wind in Poland

Equinor has exercised an option to acquire a 50 % interest in the offshore wind development project Bałtyk I in Poland from Polenergia. This transaction is a follow-up of the agreement between the two companies which came into force in May 2018 , by which Equinor acquired a 50 % inter ...

OilVoice Press - OilVoice

Posted 1 year agoPress > EquinorEquinor EnergyPoland +2

Nigeria has highest capex on crude and natural gas projects in sub-Saharan Africa Over Next Seven Years, says GlobalData

Nigeria accounts for more than 34% of the proposed capital expenditure (capex) on planned and announced crude and natural gas projects in the sub-Saharan Africa over the period 2018–2025, according to GlobalData , a leading data and analytics company. The company's report: ‘H2 2018 Production ...

OilVoice Press - OilVoice

Posted 1 year agoOpinion > GlobalDataNigeriaCrude +5

CNOOC Signs Strategic Cooperation Agreements with 9 International Oil Companies

HONG KONG, Dec. 18, 2018 /PRNewswire/ -- CNOOC Limited (the "Company", SEHK: 00883, NYSE: CEO, TSX: CNU) announced today that its parent company, China National Offshore Oil Corporation (CNOOC), has signed Strategic Cooperation Agreements with 9 international oil companies including: Chevron, Conoco ...

OilVoice Press - OilVoice

Posted 1 year agoPress > CNOOCChina National Offshore Oil CorporationChevron +11
All posts from oilvoice