Oil market recap: Week ending 17 August

PIRA Energy Group has reported that there was the largest Q2 stock build in the last 10 years this year. When it comes to the US, there was a modest stock build on the week.

Worldwide

• Commercial oil inventories in the three major OECD markets increased in the second quarter of this year.
• Weak economic activity has undermined oil demand and has forced supplies into inventory.
• High inventories have undercut confidence in oil price forecasts from PIRA.
• Front month WTI remains well supported relative to further out contracts by extraordinary low inventories and strong September refinery demand.

USA

• Overall commercial inventories increased.
• Stocks remained relatively flat to last year’s level.
• Inventories for the four major oil products are 22 million bbls below last year.
• Crude is 6 million bbls higher than last year.
• Week ending August 8, most US ethanol prices rebounded.
• Manufacturing margins for ethanol declined slightly as the lower average price for ethanol and co product DDG outweighed the fall in corn costs.
• Ethanol blended gasoline production hit a seven week high of 8.902 million bpd for week ending 8 August.
• The increase in ethanol demand was countered by an 11 week inventory low of 17.8 million bbls.
• There are no lingering effects from the harsh winter with considerable production gains in the Bakken, Eagle Ford, Niobrara and Permian basins.

Adapted from press release by Claira Lloyd

Read the article online at: https://www.oilfieldtechnology.com/drilling-and-production/19082014/oil-market-recap-week-17-aug/