I always skip to the last line of the above paragraph.
U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) decreased by 1.8 million barrels from the previous week. At 342.7 million barrels, U.S. crude oil inventories are above the upper boundary of the average range for this time of year. Total motor gasoline inventories increased by 0.8 million barrels last week, and are near the upper limit of theaverage range. Both finished gasoline inventories and gasoline blending components increased last week. Distillate fuel inventories increased by 1.2 million barrels, and are above the upper boundary of the average range for thistime of year. Propane/propylene inventories increased by 2.0 million barrels last week and are above the upper limit of the average range. Total commercial petroleum inventories increased by 1.9 million barrels last week, and are abovethe upper limit of the average range for this time of year.
That inventories are INCREASING at a time where net imports and total petroleum products supplied continue to decline at an increasing rate says NOTHING GOOD about the economy over the past 4 weeks, and the slope of the various curves leaves me wanting for the next quarter at the very least.
That does not mean that GDP will not have a positive quarter in Q3 or Q4, it very well could. I think it more likely that it disappoints, and with the end of the Stim Pack in sight, another contractionary period should be expected.
Libertarian Animal
at gmail (d0t) com
10 comments:
As an aside, an European think tank has proposed that Europe only grow ethanol crops for aircraft, on the basis that road transport can swith to alternatives, especially electric, but nothing but oil can get a plane into the air.
Makes sense to me.
I should think they mean soy bean oil for diesel... though I guess theoretically one could fly a jet on ethanol, I wouldn't fly in it.
Ethanol is a corosive, water gathering, alcohol - and flying is a zero tolerance risk.
Maybe after a dozen years while they work out the kinks....
"KINKS"! ...
Okay, this is starting to come to light more. Green shoots seems to be failing , at times at least. Oil is now showing more of the peak oil signs. Variety of loan arangements are coming "default soon" time. Weak dollar signs. Bad bank behavoir. Edgy creditors. And I am sure there are plenty of other negatives. I wonder when these things take front and center? Say Fall, after Xmas, etc. Of course mid- term elections guarentee some more FED imput.
Greg,
I would hate to be you in figuring this out. It would drive me "bat shit crazy", Just listening to Nicklebacks latest.
Peace!
In 2005 oil was trading around $45-$50/barrel. Currently oil is about $60/barrel.
So I have a question for you Greg. If in 2005 more oil was imported than today, is this the result of a slower economy or the simple fact that lower amounts of oil can be produced profitable at the current price?
Because I'm thinking if the price for oil is roughly the same adjusted for inflation, wouldn't producers keep producing oil as long the price holds?
The demand for almost everything, including oil, is dropping a bit (we are in a deflationary depression). That is a big reason why the oil production and imports are going down. But the drop in demand for oil products is not down 50% or 20% or even 10%, but maybe 5% if you add it over a year. And so far, the EIA graphs show gasoline demand is about where it always is this time of year (back up to normal). Jet fuel and diesel are lower in demand. Whether we are burning/fabricating 87, 85 or 83 million barrels a day worldwide, we are still consuming a hell of a lot of oil! Just watching the Kennedy expressway in Chicago reflects that.
I THINK (that means I am not sure of anything) that that the economy is demanding less oil... so why is the price above 2005? PERHAPS producers are demanding and getting the premium, or PERHAPS oil is up on spec and will slide into the later part of the year (my take on it...), the question is what happens in 2010 and 2011... does the RotW take up the slack and the US never gets its imports back (my take on it), or are we just f&^%$#ing dumb?
Only time will tell...
I've seen some people claim that oil can be trading down to $20/barrel. I know prices are determined by supply and demand. So my question is can oil prices fall that far if all this information about peak oil is easily accessible? I mean I am sure some billionaire or perhaps a country (China) will be buying hand over fist this commodity and keep prices stable since it may be the easiest trade to make knowing what is in store just a few years down the road.
Greg; here are news reports about airline fuel:
http://news.bbc.co.uk/1/hi/uk/8162305.stm
and an older one:
http://news.bbc.co.uk/1/hi/uk/7261214.stm
and
http://news.bbc.co.uk/1/hi/uk/7259004.stm
The price of Oil could easily fall to $20, and rocket to $200... Oil has negative and positive feedback loops into the world economy, which will only exacerbate the price swings caused by under, and then over, investment in productive capacity.
Or not...
If you are trying to trade Oil, I have no confidence in any call at this time...
Iran could blow up ($200 oil) or the economy could continue on its downward trend ($20 oil), or...
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