Better Fill up today

[Catwoman]

Frank, what is brent crude?

[frawin]

Catwoman, it is the Marker or Main Western European crude and it trades in the European futures market just like our NYMEX WTI, West Texas Intermediate, crude trades here at Cushing Oklahoma Terminal. Brent is a premier Sweet crude and is comparative to our WTI.

[Catwoman]

How on earth did it get the name brent?

[frawin]

The name "Brent" comes from the naming policy of Shell UK Exploration and Production, operating on behalf of Exxon and Shell, which originally named all of its fields after birds (in this case the Brent Goose).  Catwoman I had to look this up, if I ever knew this I had forgotten it.

[Catwoman]

Frank, it is so GOOD to have you back...Now, I'm learning something again! 

[frawin]

Crude Oil Rises as Dollar’s Decline Increases Commodity Demand


By Alexander Kwiatkowski and Gavin Evans

March 23 (Bloomberg) -- Crude oil rose to the highest in almost four months as the dollar extended its losses against the euro, increasing the investment appeal of commodities.

Oil advanced for a third day as the dollar’s decline improved the appeal of hard assets as an inflation hedge and made commodities cheaper for non-U.S. buyers. Crude for May delivery jumped 11 percent last week as the U.S. Federal Reserve announced new initiatives to lower interest rates and speculators turned bullish for the first time in three weeks.

“The recent inclination to bid up commodities as both an inflation hedge and a weak dollar play is clearly what is driving the energy market,” Edward Meir, an analyst with MF Global Ltd. in Connecticut, said in a report today. “This approach will ultimately prove unsustainable in the absence of a rebound in industrial demand.”

Crude oil for May delivery rose as much as 83 cents, or 1.6 percent, to $52.90 a barrel in after-hours electronic trading on the New York Mercantile Exchange. That was the highest since Dec. 1. Futures were at $52.69 at 8:20 a.m. in London.

The contract rose 3 cents to $52.07 a barrel on March 20, taking its gain for the week to 11 percent. Prices surged after plans by the Federal Reserve to spend $1.15 trillion buying Treasuries and mortgage bonds sent the dollar to a 10-week low, making the commodity cheaper for buyers outside the U.S.

“There’s not much out there that suggests demand is really going to pick up in the near term,” said Toby Hassall, a research analyst at Commodity Warrants Australia Pty in Sydney. “It will take time to flow through,” and oil may prove vulnerable unless the dollar continues to push lower, he said.

Equities Advance

The dollar weakened to $1.3687 per euro from $1.3582 late in New York on March 20. The U.S. currency reached $1.3738 on March 19, the lowest level since Jan. 9.

Oil also gained as Asian and European stocks and U.S. futures rose on optimism government stimulus efforts will revive lending and ease the global economic slump.

The MSCI World increased 1.4 percent at 8:01 a.m. in London, climbing for the ninth time in 10 days.

Brent crude oil for May settlement rose as much as 98 cents, or 1.9 percent, to $52.20 a barrel on London’s ICE Futures Europe exchange, and was at $51.90 at 8:22 a.m. in London. It climbed 1.1 percent to $51.22 on March 20, taking its gain for the week to 12 percent.

Hedge-fund managers and other large speculators turned bullish on oil prices last week, according to U.S. Commodity Futures Trading Commission data.

Speculative long positions, or bets prices will rise, outnumbered short positions by 13,507 contracts on the New York Mercantile Exchange on March 17, the Washington-based commission said last week. Traders had bet on price declines in the previous two weeks.

Crude oil for delivery in December 2012 surged $8.36 a barrel last week, more than the $4.81 gain in the April contract, Morgan Stanley said.
“Investors are clearly looking beyond oil’s challenged short-term outlook,” Morgan Stanley said in a report today

[frawin]

By Mark Shenk

March 25 (Bloomberg) -- Crude oil fell on speculation that a government report will show U.S. inventories gained and demand for energy tumbled.

The U.S. Energy Department is forecast to say that supplies climbed for a third week last week. The American Petroleum Institute said yesterday that stockpiles rose to the highest since 1993. Japan pared crude imports 14 percent in February from a year earlier. Total SA is cutting output at its Port Arthur, Texas, refinery in response to weakening demand.

"We have to face the reality that supplies are ample and demand is weak," said Phil Flynn, a senior trader at Alaron Trading Corp. in Chicago. "The API report yesterday showed a big build in supply and we expect the DOE to show one as well. The news about Total cutting back production and that Japanese imports are down shows just how weak demand is."

Crude oil for May delivery fell $1.16, or 2.2 percent, to $52.82 a barrel at 9:01 a.m. on the New York Mercantile Exchange. Prices are up 18 percent this year.

U.S. crude oil stockpiles increased 4.58 million barrels to 354.5 million last week, the highest since July 1993, according to a report released after the close of floor trading yesterday by the industry-funded API.

A separate report today from the DOE may show that oil stockpiles rose 1.1 million barrels in the week ended March 20 from 353.3 million the previous week, according to the median of 13 analyst estimates in a Bloomberg survey. Inventories in the week ended March 13 were the highest since June 2007.

The Energy Department is scheduled to release its weekly supply report at 10:30 a.m. in Washington.

Correlated Reports

Oil-supply totals from the API and Energy Department moved in the same direction 75 percent of the time over the past four years, according to data compiled by Bloomberg.

Japan's crude-oil imports fell for a fourth month in February as sluggish industrial output and warmer weather damped fuel demand. The world's third-biggest oil-consuming country received about 4.26 million barrels a day in shipments last month, down 14 percent from a year earlier, a finance ministry preliminary trade report released in Tokyo showed.

Total SA, Europe's third-largest oil company, is cutting output at its Port Arthur, Texas, refinery in response to weakening demand. The company said in a filing with the Texas Department of Environmental Quality yesterday that it began shutting units at the facility.

"The U.S. market has deteriorated a lot and we are adjusting to this," Total spokesman Michael Crochet-Vourey said by telephone in Paris today.

Production at the facility, which has the capacity to process 240,000 barrels of oil a day, will be stopped for weeks, United Steelworkers union members who work at the plant said.

Brent crude oil for May settlement declined $1.14, or 2.1 percent, to $52.36 a barrel on London's ICE Futures Europe exchange.



Last Updated: March 25, 2009 09:24 EDT

[frawin]

Below is the EIA weekly Petroleum Data Report, overall it is a mixed bag of positives and negatives, depending on which side of the fence you are on.

Summary of Weekly Petroleum Data for the Week Ending March 20, 2009

U.S. crude oil refinery inputs averaged 14.1 million barrels per day during the
week ending March 20, down 45 thousand barrels per day from the previous week's
average. Refineries operated at 82.0 percent of their operable capacity last
week. Gasoline production fell last week, averaging 8.7 million barrels per day.
Distillate fuel production decreased last week, averaging 3.7 million barrels
per day.

U.S. crude oil imports averaged nearly 9.4 million barrels per day last week, up
204 thousand barrels per day from the previous week. Over the last four weeks,
crude oil imports have averaged nearly 9.2 million barrels per day, 413 thousand
barrels per day below the same four-week period last year. Total motor gasoline
imports (including both finished gasoline and gasoline blending components) last
week averaged 1.1 million barrels per day. Distillate fuel imports averaged 449
thousand barrels per day last week.

U.S. commercial crude oil inventories (excluding those in the Strategic
Petroleum Reserve) increased 3.3 million barrels from the previous week. At
356.6 million barrels, U.S. crude oil inventories are above the upper limit of
the average range for this time of year. Total motor gasoline inventories
decreased by 1.1 million barrels last week, and are in the upper half of the
average range. Finished gasoline inventories fell last week while gasoline
blending components inventories rose during this same time. Distillate fuel
inventories decreased by 1.6 million barrels, and are above the upper limit of
the average range for this time of year. Propane/propylene inventories increased
last week by 0.6 million barrels and are above the upper limit of the average
range. Total commercial petroleum inventories increased by 2.8 million barrels
last week and are above the upper limit of average range for this time of year.

Total products supplied over the last four-week period has averaged 19.1 million
barrels per day, down by 3.2 percent compared to the similar period last year.
Over the last four weeks, motor gasoline demand has averaged nearly 9.1 million
barrels per day, up by 0.7 percent from the same period last year. Distillate
fuel demand has averaged about 3.8 million barrels per day over the last four
weeks, down by 9.0 percent from the same period last year. Jet fuel demand is
5.1 percent lower over the last four weeks compared to the same four-week period
last year.

The tables that follow display the latest U.S. Petroleum Balance Sheet and the
most recent 4 weeks of Weekly Petroleum Status Report data. 

[frawin]

Crude Oil Rises on Indications U.S. Fuel Demand May Be Climbing

By Grant Smith and Christian Schmollinger

March 26 (Bloomberg) -- Crude oil rose on signs that fuel demand in the U.S., the world’s largest energy consumer, may be coming out of a slump.

U.S. fuel consumption rose 2.2 percent to 19.2 million barrels a day last week, and gasoline demand gained 1.6 percent to 9.1 million barrels a day, according to the Energy Department. U.S. durable goods orders increased 3.4 percent last month, a Commerce Department report showed yesterday.

“Sentiment in the oil market has improved considerably in recent weeks, with the rise above $50 confirmation a bottom has been found,” said Carsten Fritsch, an analyst with Commerzbank AG in Frankfurt. “Durable goods data was better than expected, giving some hope about the future economy and a recovery of oil demand.”

Crude oil for May delivery gained as much as 95 cents, or 1.8 percent, to $53.72 a barrel on the New York Mercantile Exchange. It was at $53.57 a barrel at 10:14 a.m. London time.

Prices are up 20 percent this year on expectations that supply cuts by the Organization of Petroleum Exporting Countries would drain the crude glut created as the economic slump slashed demand. Monetary and fiscal policy to revive economic growth in the U.S. and other oil consumers may also add to demand.

Still, stockpiles in the U.S. continue to rise. Crude supplies rose 3.3 million barrels to 356.6 million last week, the Energy Department said yesterday. Inventories were forecast to increase by 1.1 million barrels, according to a Bloomberg News survey. Total daily fuel demand averaged over the past four weeks was 19.1 million barrels, down 3.2 percent from a year earlier.

Inventory Gain

The inventory gain was the 22nd in 26 weeks. The increase left supplies 13 percent higher than the five-year average for the period, the department said. Stockpiles gained 3.5 million barrels in the U.S. Gulf Coast region, known as PADD 3, where the majority of refining capacity is located.

“Usually a build like that in PADD 3 means the refineries aren’t taking the crude,” said Clarence Chu, a trader at options dealer Hudson Capital Energy in Singapore. “Now is the time when the refineries are shut down for maintenance.”

Other plants are closing as demand for fuels has declined. Refineries operated at 82 percent of capacity, down 0.1 percentage point from the prior week, the Energy Department said.

Total SA, Europe’s third-largest oil company, is shutting output at its Port Arthur, Texas, refinery in response to weakening demand. The company said in a filing with the Texas Department of Environmental Quality March 24 that it began closing units at the facility.

Production Halt

Production at the facility, which has the capacity to process 240,000 barrels of oil a day, will be stopped for weeks, according to United Steelworkers union members who work at the plant.

Gasoline stockpiles dropped 1.14 million barrels to 214.6 million last week. The decline left inventories 0.4 percent lower than the five-year average for the week, the department said. A 650,000-barrel drop was forecast, according to the median of 14 analyst responses in a Bloomberg News survey.

Distillate supplies declined 1.58 million barrels to 143.9 million, leaving stockpiles 25 percent above the five-year average for the period. A 100,000-barrel drop was forecast.

Brent crude oil for May settlement rose as much as $1.20, or 2.3 percent, to $52.95 a barrel, on London’s ICE Futures Europe exchange. It was at $52.56 a barrel at 9:33 a.m. London time.

[Diane Amberg]

Thanks Frank. I know prices around here are creeping up again. I think in part because our Valero refinery has been shut down.