Thursday, October 16, 2008
U.S. Energy Dept. Posts 5.6 Mln-barrel Rise In Crude Supply
SAN FRANCISCO — Crude supplies rose for a third week, up 5.6 million barrels for the week ended Oct. 10, according to the Energy Department Thursday. Motor gasoline supplies climbed 7 million barrels. Distillate stocks were down a seventh week, by 500,000 barrels. Refinery utilization was at 82.2% compared with 80.9% of capacity a week earlier. Following the news, November crude was down 4.5% at $71.21 a barrel on Globex.
Update – Crude inventory rises & price falls, while US Refinery Utilization remains very low despite slight rise. Opec is expected cut production at next Nov 18 meeting. This cites Nov crude at $71.21/Bbl but Nymex already has crude below $70/bbl for first time since Aug 2007. This slide is occuring despite Hurricane Omar impacting Venezuelan & Caribbean Refineries, some US refineries not recovered from Gustav & Ike, and Kuwait Refineries running at 65% capacity and US Utilization still only in the 80-82% range. Even those these factors tend to decrease crude use the market would normally signal a sharp increase on any one of these events – therefore expect to see crude prices fall even more sharply despite what appears to be the onset of an early winter in the US with diesel demands ontop of low product inventories.