Board Type: Semi-PrivateAdmins: Soda

An Interesting IDB update! And how IDB got even faster.  IDB is fast, reliable, and FREE to use. Just join and start posting!

Summary of Weekly Petroleum Data for the Week Ending October 20, 2017 (and "Black Blade Portfolio" Update)

Summary of Weekly Petroleum Data for the Week Ending October 20, 2017

 

U.S. crude oil refinery inputs averaged over 16.0 million barrels per day during the week ending October 20, 2017, 586,000 barrels per day more than the previous week’s average. Refineries operated at 87.8% of their operable capacity last week. Gasoline production decreased last week, averaging over 9.9 million barrels per day. Distillate fuel production increased last week, averaging 4.8 million barrels per day.

 
U.S. crude oil imports averaged over 8.1 million barrels per day last week, up by 640,000 barrels per day from the previous week. Over the last four weeks, crude oil imports averaged 7.6 million barrels per day, 3.2% above the same four-week period last year. Total motor gasoline imports (including both finished gasoline and gasoline blending components) last week averaged 233,000 barrels per day. Distillate fuel imports averaged 133,000 barrels per day last week.
 
U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) increased by 0.9 million barrels from the previous week. At 457.3 million barrels, U.S. crude oil inventories are in the upper half of the average range for this time of year. Total motor gasoline inventories decreased 5.5 million barrels last week, but are in the upper half of the average range. Both finished gasoline inventories and blending components inventories decreased last week. Distillate fuel inventories decreased by 5.2 million barrels last week and are in the lower half of the average range for this time of year. Propane/propylene inventories decreased by 1.2 million barrels last week and are in the lower half of the average range. Total commercial petroleum inventories decreased by 12.2 million barrels last week.
 

Total products supplied over the last four-week period averaged over 19.6 million barrels per day, down by 3.6% from the same period last year. Over the last four weeks, motor gasoline product supplied averaged 9.3 million barrels per day, up by 1.6% from the same period last year. Distillate fuel product supplied averaged 3.8 million barrels per day over the last four weeks, down by 6.5% from the same period last year. Jet fuel product supplied is up 2.9% compared to the same four-week period last year.


Black Blade: This week's EIA Petroleum Inventory Status Report is MODERATELY BULLISH as we see a slight gain in crude inventories but a massive draw on gasoline and distillates while refinery utilization is slowly recovering near pre-hurricane Harvey levels. Recently imports have been poised for a sharp rebound but reports of substandard quality Venezuelan crude have spread about the global market and some imports are now being refused or sold for very steep discounts to cover the associated required cleaning and refining costs. Meanwhile, Saudi has emerged once again as the second largest importer by volume to US refiners. Another potential bullish indicator is that Saudi and presumably OPEC have stated their intent to cut back production further even as Russia has balked at the suggestion and demand a new agreement. Marginal US Shale Producers have begun to see declining production and with rig counts declining over the last seven weeks and along with rising costs for drilling and fracking services we may see domestic crude supplies tighten even as SPR oil sales have added to supplies in recent months. It appears that Asia and China in particular has been experiencing a renewed boom of manufacturing and economic activity which is always a good sign for natural resource commodities (metals, oil and natural gas). Apparently US industry is on the rebound if company reports in the most recent "earnings season" are to be believed.

Meanwhile, we see prices for Units in MLPs and Royalty Trusts falling once again and interest rates are expected to climb impacting distributions due to higher financing costs. That said, we are adding more DMLP and SJT to the portfolio as well as NLY (a Mortgage REIT) on the bass of buying while there's "blood in the streets" as it were. Actually the financials are very good on these long term entities and are comfortable slowly adding units to the mix. We are also looking over the new Initial Public Offering BP Midstream Partners LP (BPMP) given the strength of the parent company and outlook for continued long term payouts from this "tollbooth" play. Pipelines have been hammered recently once again on interest rate fears but we fell it may be worth the risk.

We continue to add physical silver bullion to the portfolio as it is on sale as prices fall and nears the cost of production. We are accumulating American Silver Eagles now and are watching for gold to fall under $1,100/oz before accumulating more gold bullion in the form of American Gold Eagles, That said, we continue to hold Bitcoin (Coinbase) as we sold some and are effectively playing with the "house's money". We looked at Ethereum but are holding now even as it has soared over 4,000% in the last couple months. Not for the faint of heart that's for sure. We also continue to look over physical real estate for rental income as we sold one property and acquired another (near a college campus - Yikes, pizza on the ceilings and beer in the carpet?). Meanwhile, Mrs Blade continues to sell artwork and some of her art has been printed as post cards and sold through the National Steinbeck Center as a tribute to her Hispanic heritage of migrant "pickers" in California.

As always, get out of debt and stay out of debt, accumulate physical Silver and Gold Bullion as "portfolio insurance" and stockpile supplies of long ter nonperishable foods and basic necessities. After all, we do "live in interesting times".