Mitch McConnel Now Interested in Passing New Stimulus Package
November 5, 2020
The DOE inventory report said that crude oil stocks were down 8.0 million barrels and the stocks at Cushing, Ok were up 940,000 barrels. Gasoline stocks were up 1.54 million barrels and distillates were down 1.58 million barrels. Inventories excluding the Strategic Petroleum Reserve are 8% above the five year seasonal average. Crude is +7%, Gasoline is +4%, and Distillates are +17%.
The expectation is that no major changes will take place when the Federal Reserve announces their policy decision later today. Earlier today the Bank of England announced a bigger than expected 150 billion pounds ($195 million) round of quantitative easing to help the UK economy.
The growing thought that OPEC+ will delay their plans to increase production in January puts a level of support at some level under the market.
Propane stocks showed a bigger draw than expected a 2.563 million barrels . Midwest stocks were down 12,000 barrels putting total stocks at 25.869 million barrels 292,000 barrels more than last year. Gulf stocks were down 1.825 million barrels putting total stocks at 56.145 million barrels 773,000 less than last year. Production is still strong at 2.204 million bpd and this is the third week that production has seen a slight uptick. Export were the big increase and the main reason stocks decline. Exports were up 224,000 bpd to a total of 1.425 million bpd. Exports has been and will continue to be the wild card with regards to where inventories go moving forward. Current outlook is for them to stay strong for the balance of the year. Most forecast are still calling for temperatures above normal that I have seen.
First time unemployment benefits were reported to be higher than expected at 751,000. Continuing claims rose to 7.285 million compared to an expectation of 7.2 million.
There are some rumblings that a stimulus package could get some traction here in the near term and that is supportive to energy prices. There has been some comment by Senate leader, Mitch McConnell. On Wednesday at press conference he said, “I think we need to do it. We need to do it before the end of the year.”