The bears in the energy market was given most of what it anticipated…demand decline, refinery run increase, refined product inventory builds but another surprise in crude oil. Although the crude oil stocks declined again a portion of it was reflective of another big increase in refinery utilization. Even with the crude oil decrease overall inventories in the US remain well supplied further reducing any potential supply problems in the near or even medium term.
As we are in the heart of the gasoline driving season we need to point out that gasoline stocks are about 6.5 million barrels above last year at this time while gasoline demand is on the defensive. The following three charts show, total demand, gasoline demand and distillate (heating oil & diesel) demand . All continuing to trend lower and further indicating that the current high price environment is starting to impact consumption habits of individual as well as business.
Overall the report is bearish and should continue to keep pressure on prices for the remainder of the week (barring any Geopolitical surprises).
Dominick A. Chirichella
Energy Management Institute
tel 646-202-1433
tel 845.368.3904
fax 801.383.7510
www.advancedenergycommerce.com
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