WHO says Second Year of COVID Could be Tougher than the First
January 14, 2021
Crude stock were down 3.25 million barrels right on market expectations, so this number was seen as neutral. Gasoline stocks were up 4.4 million and distillates were up 4.79 million, which were both more than the market expected. Crude oil production remained flat at 11 million barrels.
On the bearish side, the EIA reported their monthly Short Term Energy Outlook (STEO) report (1/12/2021), which lowered supply forecast for 2021 but lowered consumption forecast even more for 2021. The net result is a forecast change for 2021 of 93,357 bpd of more crude oil. The STEO did raise their 2021 crude oil price forecast by $4.00 for WTI crude oil and by $4.25 for Brent crude oil. However, some energy analysts warn of stronger coronavirus lockdowns and rising cases and deaths will continue to weigh down crude oil and fuel demand for the first half of 2021.
Kpler estimated this week that the amount of crude oil and condensate stored on tankers worldwide fell to near a ten month low recently.
The World Health Organization said the second year of the COVID-19 pandemic may be tougher than the first given how the new coronavirus is spreading.
Propane stocks were down 6.729 million barrels putting total stocks at 66.048 million barrels compared with last year at this time when there were 81.804 million. Again, exports were the big driver, they were up 272,000 bpd to a total of 1.347 million bpd. Midwest stocks were down 1.726 million barrels to a total of 18.654 million compare with 19.253 million last year. Gulf Coast stocks were down 4.279 million(exports) to a total of 34.960 million barrels compared with 52.864 million barrels last year. Propane price continue to be strong as export demand continue to decrease inventory levels. I read a comment today that said some fear if exports continue at this pace Mt Belvieu will run out. That seem pretty bold, but we will see how things progress.
The market is down a bit this morning as China reports cases of coronavirus surging to a ten month China has put some new restriction in place. This is pressuring crude as China is the world second largest crude oil consumer.
President-elect Biden is supposed to announce his stimulus plan today.