US Production Outpaces Imports

On October 24, 2013 by TradingDesk

For the first time since the summer of 1994, the US produced more oil than it imported last week, according to Yesterday’s DOE report. The first chart below shows 30 years’ worth of data for each point. While that news helped push WTI lower for a third straight day, prices still stand at $96, compared to $19 the last time this happened.

Total crude stocks surged another 5 million barrels last week, the highest monthly increase in 18 months, but the bulk of the build came along the gulf coast, not in the Cushing OK hub, suggesting that the Nymex delivery point bottleneck, often cited as a reason for Brent’s premium to WTI, may be circumvented by increased crude output in Texas.

RBOB and ULSD both sold off heavily yesterday, as the DOE’s demand estimates continued to show weak domestic consumption, and technical support levels began to break down. Gulf Coast & Midwest gasoline prices are now 25 cents lower in just the past 5 trading sessions, and spot ULSD prices are down 12-15 cents. Both contracts are on the cusp of another major move lower, although some technical support must still be broken in the $2.50 range for RBOB and at $2.90 for ULSD before a real sell-off can occur.

CLICK HERE for a PDF of today’s charts

Market Update (3)

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