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Sunday, September 23, 2018

U.S. refinery maintenance and outages support products tanker market

Continuing cold weather in the U.S. along with refinery and pipeline problems has been providing support for products tanker market. A recent draw on U.S. product stocks, along with refinery maintenance, unplanned refinery outages and higher demand from the agricultural sector, may lend support to crude oil and product imports over the coming weeks, according the U.S. Energy Information Administration (EIA) in Washington.


However, with the completion of the ongoing refinery maintenance schedule, product markets are expected to lose some of their current strength. Lower refining runs in the U.S. and Europe due to seasonal maintenance and unplanned shutdowns left product inventories lower in these two regions in February.


U.S. product stocks decreased by 46.6 mb (million barrels) while crude inventories saw only a minor gain of 0.3 mb, leaving total commercial oil stocks at 987 mb, showing a drop of 46.3 mb from the previous month.


The EU’s total oil stocks stood at 1,143 mb, down 11 mb from the previous month. Almost two thirds of the decline in EU-16 came from products. Nevertheless, both U.S. and EU stocks remained 16 mb and 51 mb above the five year average.


As a contrast, Japan’s January commercial oil stocks increased 2 mb to 200 mb, implying a surplus of 16% above the five-year average. However preliminary data for February shows that stocks had moved down to below 190 mb.

Gasoline imports to the U.S. started relatively high this year but then started dropping, and imports 2 February-9 March were considerably lower than the same period of the last three years. Gasoline stocks as of 9 March were 3-4% lower than at the same time in the two previous years. Distillate imports of 0.373 mbd during the 10 first weeks of 2007 were 12% lower that for the same period in 2006, but 12% higher than for the same period in 2005.


US crude oil production is slightly lower today than it was at the end of 2006, and commercial stocks are more than 4% lower than this time last year, but almost 3% higher than the average over than last three years. Crude oil imports to the U.S. are also 1.5% lower than for the same period in 2006 and have been steadily declining in comparison.