|
Crude Oil
Fundamental Notes
Fundamentally, the key statistic in the crude oil market is world surplus production capacity and that was only 1.5 million barrels per day (mbd) in 2008 - most of it in Saudi Arabia. On August 10, 2010, the U.S. Energy Department said that surplus capacity was nearly 5.0 million barrels per day in July - a far more comfortable margin.
On August 10, 2010, the DOE estimated OPEC's actual production at 29.7 mbd in July with 2.3 mbd coming from Iraq. The DOE also estimated that world consumption will increased to 85.9 mbd in 2010 and 87.4 mbd in 2011. West Texas crude oil prices are expected to average $79.13 in 2010 and $83.50 in 2011. On August 27th, U.S. crude oil stocks were up 5% from a year ago.
| World Crude Oil Statistics (million barrels per day):
| | Year | 2001 | 2002 | 2003 | 2004 | 2005 | 2006 | 2007 | 2008 | 2009 | 2010 | 2011
| | Production | 77.7 | 77.0 | 79.6 | 83.1 | 84.6 | 84.6 | 84.5 | 85.4 | 84.3 | 86.0e
| 87.1e
| | Consumption | 77.5 | 78.1 | 79.7 | 82.5 | 84.0 | 85.2 | 86.3 | 85.8 | 84.3 | 85.9e
| 87.4e
| | Source: U.S. Department of Energy.
|
Top Three Producers In 2009:
OPEC (40% of world production)
Former Soviet Union (15%)
U.S. (11%)
|
Latest "This Week In Petroleum" from the U.S. Department of Energy >
Latest U.S. Petroleum Balance Sheet >
Latest Short-term Energy Outlook from the U.S. Department of Energy >
Key Events - Crude oil
2010
8-13 - OPEC: World oil demand est. at 85.50 mbd in 2010 and 86.56 mbd in 2011.
8-10 - DOE: World oil demand est. at 85.9 mbd in 2010 and 87.4 mbd in 2011.
7-15 - OPEC: World oil demand est. at 85.37 mbd in 2010 and 86.41 mbd in 2011.
7-7 - DOE: World oil demand est. at 85.8 mbd in 2010 and 87.3 mbd in 2011.
6-9 - OPEC: World oil demand est. at 85.37 mbd in 2010.
6-8 - DOE: World oil demand est. at 85.5 mbd in 2010 and 87.1 mbd in 2011.
5-11 - DOE: World oil demand est. at 85.6 mbd in 2010 and 87.2 mbd in 2011.
5-11 - OPEC: World oil demand est. at 85.38 mbd in 2010.
4-14 - OPEC: World oil demand est. at 85.21 mbd in 2010.
4-6 - DOE: World oil demand est. at 85.5 mbd in 2010.
3-10 - OPEC: World oil demand est. at 85.24 mbd in 2010.
3-9 - DOE: World oil demand est. at 85.5 mbd in 2010.
2-10 - DOE: World oil demand est. at 85.3 mbd in 2010.
2-10 - OPEC: World oil demand est. at 85.12 mbd in 2010.
1-19 - OPEC: World oil demand est. at 85.15 mbd in 2010.
1-15 - IEA: World oil demand est. at 86.3 mbd in 2010.
1-12 - DOE: World oil demand est. at 85.2 mbd in 2010.
2009
12-30 - DOE: Crude oil supplies at 326 mb.
12-15 - OPEC: World oil demand est. at 84.3 mbd in 2009 and 85.1 mbd in 2010.
12-12 - Iraq's Oil Minister: Production capacity could reach 12 mbd in six years.
12-8 - DOE: World oil demand estimated at 84.1 mbd in 2009 and 85.2 mbd in 2010.
11-11 - OPEC: World oil demand est. at 84.3 mbd in 2009 and 85.1 mbd in 2010.
11-10 - DOE: World oil demand estimated at 84.1 mbd in 2009 and 85.4 mbd in 2010.
10-13 - OPEC: World oil demand est. at 84.2 mbd in 2009 and 84.9 mbd in 2010.
10-6 - DOE: World oil demand estimated at 83.7 mbd in 2009 and 84.8 mbd in 2010.
9-28 - Iran test fired Shahab-3 missiles with a 2,000 kilometer range, capable of reaching Israel and other targets around the Middle East. This adds to the tensions created by Friday's disclosure that they have a second nuclear facility near Qom.
9-24 - IHS Cambridge Energy Research Associates: The oil industry discovered 10 billion barrels of new oil reserves in the first half of 2009 and is on track for their best year since 2000.
9-15 - OPEC: World oil demand est. at 84.1 mbd in 2009 and 84.6 mbd in 2010.
9-10 - DOE: Crude supplies down 5.9 mb to 337.5 mb.
9-10 - DOE: 165.6 million barrels of distillate inventories is the most since 1983.
9-9 - DOE: World oil demand estimated at 83.7 mbd in 2009 and 84.6 mbd in 2010.
| Are You Keeping Up With The Markets? |
|
Subscribe to The Dailyfutures News Report >
In one brief email every business day, you will receive:
A concise news summary of the futures markets;
Links to the best news articles; and
Chart comments from a unique perspective.
Learn more >
|
Reformulated Gasoline
Fundamental Notes
The financial crisis of 2008 and resulting recession took the starch out of the energy markets, but long-term energy challenges remain. Gasoline supplies are up 10% from a year ago and demand over the past four weeks was up 1.9% from a year ago. On August 10, 2010, the DOE predicted that retail regular gasoline will average $2.77 in 2010 and $2.92 in 2011.
Heating Oil
Fundamental Notes
As of August 27th, distillate supplies were up 7% from a year ago and demand for distillates over the past four weeks was up 7.8% from a year ago. Heating oil supplies were up 8% from a year ago. On August 10, 2010, the DOE estimated that wholesale heating oil prices will average $2.12 in 2010 and $2.28 in 2011.
Natural Gas
Fundamental Notes
The DOE said that underground storage levels, as of August 27th, were down 6% from a year ago and up 6% from the five-year average. On August 10, 2010, the DOE estimated 66.1 billion cubic feet (bcf) per day of new supplies in 2010. That should cover the estimated demand of 64.9 bcf per day. The DOE expects the Henry Hub spot price to average $4.83 per thousand cubic feet in 2010 and $5.13 in 2011.
Which U.S. regions are the biggest consumers of natural gas? Number one is the West South Central Division, consisting of Arkansas, Louisiana, Oklahoma, and Texas. A close second is the East North Central Division, consisting of Illinois, Indiana, Michigan, Ohio, and Wisconsin. A distant third is the Pacific division, consisting of Alaska, California, Hawaii, Oregon, and Washington.
| U.S. Natural Gas Statistics (billion cubic feet):
| | Year | 2001 | 2002 | 2003 | 2004 | 2005 | 2006 | 2007 | 2008 | 2009 | 2010 | 2011
| | Supply | 60.7 | 62.9 | 60.9 | 60.0 | 59.7 | 59.2 | 63.9 | 63.8 | 64.0 | 66.1e
| 65.4e
| | Consumption | 60.9 | 63.0 | 61.0 | 61.2 | 60.3 | 59.4 | 63.3 | 63.5 | 62.5 | 64.9e
| 64.9e
| | Source: U.S. Department of Energy.
|
Latest U.S. natural gas inventory report from the U.S. Department of Energy >
Key Events - Natural gas
2010
6-8 - DOE: Estimates U.S. demand at 64.9 bcf per day in 2010 and 64.6 bcf per day in 2011.
6-2 - President Obama mentions natural gas in a speech in Pittsburgh as an alternative to oil.
5-11 - DOE: Estimates U.S. demand at 64.4 bcf per day in 2010 and 64.2 bcf per day in 2011.
4-6 - DOE: Estimates 2010 demand at 63.8 bcf per day.
3-9 - DOE: Estimates 2010 demand at 62.9 bcf per day.
2-10 - DOE: Estimates 2010 demand at 62.5 bcf per day.
1-21 - DOE: N. gas supplies -245 bf to 2.607 tcf. Supplies now +1% from year ago and slightly below the five-year average.
1-14 - DOE: N. gas supplies -266 bf to 2.852 tcf last week. Supplies now +4% from a year ago.
1-12 - DOE: Estimates 2010 demand at 62.4 bcf per day.
2009
12-10 - DOE: N. gas supplies -64 bcf to 3.773 tcf last week, the first drawdown of the season.
12-8 - DOE: Estimates 2010 demand at 61.9 bcf per day.
11-25 - DOE: N. gas supplies hit 3.835 tcf, up 12% from a year ago and a possible peak for the season.
10-8 - DOE: N. gas supplies hit 3.658 trillion cubic feet, up 15% from a year ago and near their estimated maximum of 3.89 tcf.
8-20 - CEO of Quicksilver Resources, a major natural gas producer, said that current prices are below their costs to produce.
Common terms
API is the American Petroleum Institute.
Brent crude oil refers to North Sea oil that trades primarily in London. It is quoted most often as the "world" price.
DOE is the U.S. Department of Energy.
EIA is the Energy Information Administration. This is a sub-branch of the U.S. government's Department of Energy.
IEA is the International Energy Agency. This organization is based in Paris, France. They issue monthly reports on the world oil situation and OPEC production estimates. They have ties to the OECD.
Imported or world or sour crude is primarily the type of crude oil referred to by OPEC and is known for having more than .5% sulphur. It tends to be $2 to $3 per barrel cheaper than the WTI price.
MBD stands for million barrels per day. KBD stands for thousand barrels per day.
OECD is the Organization for Economic Cooperation and Development. This group is composed of 30 member countries that share a committment to democratic government and market economies. The members are: Australia, Austria, Belgium, Canada, the Czech Republic, Denmark, Finland, France, Germany, Greece, Hungary, Iceland, Ireland, Italy, Japan, South Korea, Luxembourg, Mexico, Netherlands, New Zealand, Norway, Poland, Portugal, Slovak Republic, Spain, Sweden, Switzerland, Turkey, the United Kingdom, and the United States.
OPEC is the Organization of Petroleum Exporting Countries. There are thirteen countries in this well-known group: Algeria, Angola, Ecudaor, Indonesia, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, the United Arab Emirates (UAE), and Venezuela.
OPEC-12 excludes Iraq.
OPEC's basket price is an average of the following seven types of crude:
Saudi Arabia's Arab Light
The UAE's Dubai
Nigeria's Bonny Light
Algeria's Saharan Blend
Indonesia's Minas
Venezuela's Tia Juana Light
and Mexico's Isthmus.
RBOB is reformulated gasoline blendstock for oxygen blending. RBOB conforms to industry standards for reformulated regular gasoline blendstock for blending with 10% denatured fuel ethanol (92% purity). RBOB is a wholesale non-oxygentated blendstock traded in the New York Harbor barge market that is ready for the addition of 10% ethanol at the truck rack (Source: NYMEX.com).
SPR is the Strategic Petroleum Reserve. This is an emergency supply of crude oil that is held in reserve by the U.S. government.
WTI is West Texas Intermediate or sweet crude. This is traded on the New York Mercantile Exchange and is commonly referred to in articles about domestic oil. It has less than .5% sulphur and tends to be $2 to $3 per barrel more expensive than imported crude.
|