Coincidence of EIA Report Delay? - "I had seen it delayed minutes, and a couple of times a few hours, but don’t recall something like this — do others?" asks Javier Blas

[Tom Nolan + 2,443]

After API Reports Big Crude Build, EIA Announces Official Data Won't Be Published

by Tyler Durden

Wednesday, Jun 22, 2022 - 03:38 PM

Update (1700ET): Shortly after API reported a surprisingly large crude inventory build last week (and the first gasoline build in 3 months), The US Energy Information Administration (EIA) issued a statement saying that it won't publish its closely-watched weekly oil inventory report as planned on June 23 as "a result of systems issues."

“Our experts are working on a solution to restore the affected systems”

Full Statement:

Several U.S. Energy Information Administration (EIA) product releases scheduled for the week of June 20, 2022, will be delayed as a result of systems issues. Our experts are working on a solution to restore the affected systems.

We will release the Weekly Natural Gas Storage Report as scheduled on June 23. All other data releases scheduled for this week will be delayed. We will resume our normal production schedule and release delayed data as soon as possible.

We apologize for the inconvenience of this delay, and remain committed to our mission of collecting, analyzing, and disseminating independent and impartial energy information as we resolve this issue.

Bloomberg's Energy expert Javier Blas took to Twitter to point out just how unusual this is...

[JAVIER BLAS TWITTER IMAGE AND QUESTION]

There's no coincidences in politics (or politically-sensitive data).

*  *  *

Oil prices extended their recent weakness today, finding support at around $102 again before bouncing back, driving by recession fears.

Crude has whipped back and forth as the Fed’s commitment to taming inflation “has shaken the confidence of investors using crude as an inflation hedge,” said Rebecca Babin, senior energy trader at CIBC Private Wealth Management.

“Market liquidity is challenged as volatility has also taken its toll on traders and investors alike, leaving crude susceptible to massive swings.”

Futures holdings are at the lowest since 2016, leaving headline prices prone to outsized swings.

API

• Crude +5.607mm

• Cushing -390k

• Gasoline +1.216mm - first build since March

• Distillates -1.656mm

US crude stocks rose for the 3rd straight week (and rose significantly) and gasoline inventories built for the first time since March...

Source: Bloomberg

WTI was hovering around $105.20 ahead of the API data and slipped lower on the surprise crude/gasoline builds...

Finally, we note that wholesale gasoline prices bounced higher today, shrugging off Biden's plans for a federal tax cut...

But we note that retail prices are down 6c in the last week and wholesale prices suggest prices could drop further in the short-term...

Biden victory lap?

Not so fast as Goldman reminded traders today that “investors should remember that Fed-induced slowdowns are simply a short-term abatement of the symptom - inflation -- and not a cure for the problem - underinvestment."

https://www.zerohedge.com/energy/wti-extends-losses-after-surprise-crude-gasoline-builds

[Tom Nolan + 2,443]

Biden Blames Putin, Refiners, & Gas Stations For Record Prices: 'Cost Of Saving Democracy'

by Tyler Durden

Wednesday, Jun 22, 2022 - 12:57 PM

Having had the 'Putin Price Hike' narrative thoroughly dismissed by Fed Chair Powell earlier in the day, President Biden is set to keep repeating the 'big lie' until more people believe it.

Presumably, President Biden will announce his cunning plan to cut the federal gas tax...

“By suspending the 18-cent federal gas tax for the next 90 days, we can bring down the price of gas and bring families a bit of relief,” Biden said Wednesday at the White House.

 

Breaking down proposed tax savings, 18-cent savings per gallon of regular gas for 12 gallons (average fuel tank size for a US car) will save the consumer a whopping $2.16 every time they fill up. 

Something that President Obama called "a gimmick" and Speaker Pelosi called "very showbiz".

[SEE IMAGES AND VIDEO CLIPS IN ARTICLE]

FLASHBACK: Barack Obama in 2008 slams proposed gas tax holiday: "This isn't a real solution. It's a political stunt. This is what Washington does whenever there's a big problem. Politicians pretend they're looking out for you but they're just looking out for their poll numbers."

President Biden set to announce a suspension of the Federal gas tax for the summer. In March, Speaker Pelosi called a gas tax suspension plan "showbiz" and effectively said its a bad idea and won't help.

President Biden explained "this is a time of war and global peril," and that he reminded voters that he had always said there would be a price to pay for saving democracy in Ukraine.

Biden said that states, many of which are enjoying budget surpluses thanks in part to federal pandemic stimulus, should also suspend their own gas taxes, and he called on refiners and gasoline retailers to make sure “every penny” of the tax pause goes to consumers.

"Your customers, the American people, they need relief now,” Biden said.

The president took another shot at 'big oil', claiming they should stop buying back their own shares and spend that money on refining capacity. There's just one problem with that...

ZERO HEDGE COMMENT...BIDEN: WANT OIL FIRMS TO USE PROFITS TO INCREASE REFINING CAPACITY INSTEAD OF BUYING BACK STOCK Which is great... only oil firms don't do buybacks, they pay dividends. If Biden wants to end buybacks, he should just go after his liberal tech friends

Biden: "To the companies running gas stations and setting those prices at the pump, this is a time of war, global peril, Ukraine. These are not normal times. Bring down the price you are charging at the pump. Do it now."

Of course, the president didn’t take questions after his remarks, since that would mean explaining all the policy contradictions: he’s moved to curtail US oil production in the past before now urging its expansion, and cutting the price of gasoline may encourage higher consumption, countering his efforts to reduce US dependence on fossil fuels. 

"Bottom line is this is just kind of another rhetorical tool of the White House to sort of show that they’re doing everything they can on inflation,” Libby Cantrill, head of public policy at Pacific Investment Management Co., said Wednesday on Bloomberg Television.

Ironically, Wholesale Gasoline prices are up today... as you'd expect from an inflationary policy...

Will President Biden claim a victory lap as gas prices have dropped 6c in the last week...

Watch the president mumble through another failed narrative (due to start at 1400ET):

[VIDEO]

As Summit News' Paul Joseph Watson detailed earlier, only 11 per cent of Americans believe the Biden administration’s narrative that Vladimir Putin is to blame for record high gas prices, with the majority blaming Biden’s poor energy policies instead.

A Rasmussen poll finds that 52 per cent of respondents think unaffordable gas prices are the fault of the president, with the vast majority rejecting the ‘Putin price hike’ excuse.

The survey also found that 80 per cent of Republicans blame Biden for the energy crisis, while 54 per cent of Independents also say responsibility lies with the occupant of the Oval Office.

29 per cent of respondents who didn’t blame Putin or Biden said greedy oil companies were the culprit.

After the Biden administration’s attempt to blame the Russian leader failed to land, the White House has switched its rhetoric to start blaming oil companies, with Biden asserting the industry is “making more money than God.”

The poll reveals that Americans are also unimpressed with the media’s attempt to prop up the failing Biden economy, with just 11 per cent saying it has gotten better, with 57 per cent rating his economic performance as “poor.”

Biden loyalists have become increasingly absurd in trying to explain away gas price hikes and inflation, with former Treasury Secretary Larry Summers blaming people who downplay what happened on January 6.

“The banana Republicans who are saying that what happened on January 6th was nothing or OK are undermining the basic credibility of our country’s institutions and that in turn feeds through, uh, for inflation,” said Summers.

BlackRock CEO Larry Fink also ludicrously claimed “nationalism” was to blame for inflation, asserting,

“The rise– whether you call it nationalism or the rise of this belief that we have to focus on communities that have been devastated by globalization, we need to find ways of creating better jobs for more Americans, that in itself is inflationary.”

As we highlighted earlier, more emergency services in the U.S. are having to limit the amount of 911 calls that they are responding to in person because of record high gas prices.

https://www.zerohedge.com/political/only-11-americans-believe-biden-narrative-putin-blame-record-gas-prices

[Tom Nolan + 2,443]

Oil Giants Warn Of Much Higher Prices For The Next 3-5 Years Amid Lack Of Supply

by Tyler Durden

Wednesday, Jun 22, 2022 - 01:56 PM

https://www.zerohedge.com/commodities/oil-giants-warns-much-higher-prices-next-3-5-years-amid-lack-supply

[Tom Nolan + 2,443]

https://www.zerohedge.com/markets/inflation-was-high-ukraine-powell-tosses-biden-back-under-bus

'Inflation Was High Before Ukraine': Powell Tosses Biden Back Under The Bus

by Tyler Durden

Wednesday, Jun 22, 2022 - 10:36 AM

At the end of May, amid a flurry of scapegoating over surging prices and plunging approval ratings, President Biden seized on an Oval Office meeting with Fed Chair Powell to argue that while fighting price increases is his top priority, that work was primarily the purview of the Federal Reserve.

“My plan is to address inflation. That starts with a simple proposition: respect the Fed, respect the Fed’s independence, which I have done and will continue to do,” Biden said.

Addittionally, Biden placed the blame for Americans' suffering squarely on the shoulders of Russian president Vladimir Putin and his 'Putin Price Hike'...

 

As we have noted numerous times, this is just farcical spin as the following chart shows consumer prices were accelerating dramatically well before the Russian invasion of Ukraine...

Democrat Chris Van Hollen of Maryland is having none of that at all as he affirmed Biden's narrative during Powell's hearing this morning, blaming the "three P's" for inflation:

• Putin's war

• Pandemic supply disruptions

• Price gouging

And definitely not over-zealous and profligate spending and over-regulation by the Biden administration.

But, having thrown The Fed under the bus in May, it appeared Chair Powell was not going to take that lying down as he responded surprisingly honestly to a clearly politically-angled question (fact)...

Sen Bill Hagerty (R-TN) addressed the Biden narrative, noting that "the problem [of inflation] hasn't sprung out of nowhere," before asking Chair Powell the following question:

"Would you say that the war in Ukraine is the primary driver of inflation in America?"

Fed Chair Powell's response - which we note was completely ignored by many mainstream media outlets who were writing real-time transcripts of the hearing - was shocking in its frankness:

"No. Inflation was high, certainly before the war in Ukraine broke out."  [VIDEO]

[Tom Nolan + 2,443]

https://www.zerohedge.com/political/biden-administrations-ignorant-energy-policies-higher-gas-prices-are-only-beginning

The Biden Administration's Ignorant Energy Policies: Higher Gas Prices Are Only The Beginning

by Tyler Durden

Saturday, Jun 18, 2022 - 12:30 PM

Authored by Doug French via The Mises Institute,

While Americans angrily grit their teeth while filling their gas tanks, the very first United States special presidential envoy for climate said:

This year, we have to implement those promises and what it means is that we have to decarbonize the power sector five times faster than we are right now. We have to deploy renewables five times faster than we are right now. We have to transition to electric vehicles about 20 times faster than we are right now. And we have to fully transition to a resilient Net Zero economy faster.

 

If reality was beyond his reach before, John Kerry surely lost touch when he married into the Heinz condiment colossus in 1995. He talks as if he were ordering lunch from his harried house staff, “Faster, Jeeves. Can’t you hurry up and decarbonize already?” All of this service to the country has left Kerry clueless as to physics, not to mention economics.

“And to say it is to expose a level of ignorance that is scary,” the green cartoon chicken known as Doomberg told Tony Greer on Real Vision:

Actually, that our politicians would think despite all the evidence before them, that somehow, we can wave a magic wand and accelerate the adoption of electric vehicles by a factor of 20 when we don't have enough lithium, nickel or cobalt to even support the current growth trajectory. It's just crazy. Where's the diesel going to come from to mine all the cobalt and nickel and lithium that we're going to need?

Global consumption of petroleum and liquid fuels will average just short of a hundred million barrels a day this year, an increase of 2.2 million barrels a day from 2021. Yet, Chevron CEO Mike Wirth stresses, "there hasn’t been a refinery built in this country since the 1970s." More ominously, he predicts, "I personally don’t believe there will be a new petroleum refinery ever built in this country again."

A good’s increased price should be a signal to entrepreneurs to produce more of that product. In a free market that would be the case. But, as Mr. Wirth explains, "at every level of the system, the policy of our government is to reduce demand, and so it’s very hard in a business where investments have a payout period of a decade or more." "And the stated policy of the government for a long time has been to reduce demand for [petroleum] products."

In his book Omnipotent Government, Ludwig von Mises explained:

The dangerous fact is that while the government is hampered in endeavors to make a commodity cheaper by intervention, it certainly has the power to make it more expensive.

So, Joe Biden jawbones about lowering prices at the pump while gas prices hit new highs (and the summer driving season has yet to arrive).

Doomberg puts a finer point on the lack of refineries: 

The last major refinery to be built in the US was in 1977. And by major, I mean more than 100,000 barrels a day. There's been some small ones put in, and some specialty ones here and there. But by and large, because of environmental pressure, the US has not made a new refinery at scale in 40 years, 45 years, which is pretty incredible.

And, that’s not the worst of it.

“But also, what's happened concurrently is especially on the East Coast and the West Coast, big surprise, many refineries have been shut down because of environmental pressure,” Doomberg said.

With these closures, the net effect was something like 17.8 million barrels a day in the 1980’s. And it’s 18 million barrels a day today.

“When you consider how much GDP growth that's exploded over that time period, you can see where the constraints are,” said Doomberg.

According to Doomberg,

The world's running out of diesel. And if we run out of diesel, that's a really big deal. The consequence of demand destruction is going to be a severe economic recession slash depression.

As Mises pointed out, one government intervention inevitably leads to another, and Doomberg predicts “the Biden administration [will] push for a ban on diesel exports, which is going to be a lot easier to sell politically.”

This will hurt refiners, as diesel prices internationally are much higher for the 650,000 barrels they export a day. 

The environmental crowd, now armed with government power, may believe they are doing God’s work, but as Mises pointed out:

The effect of its interference is that people are prevented from using their knowledge and abilities, their labor and their material means of production in the way in which they would earn the highest returns and satisfy their needs as much as possible. Such interference makes people poorer and less satisfied.

When you fill up your tank, that’s how you feel, “poorer and less satisfied.” 

[Tom Nolan + 2,443]

U.S. Oil And Gas Exports Are Fueling Higher Domestic Prices

By Kurt Cobb - Jun 22, 2022, 3:00 PM CDT

• In the last decade, the U.S. oil and gas industry won a long-fought battle to lift federal restrictions that limited exports so that it could take full advantage of the shale revolution.
• Today, that is one of the key reasons why the U.S. is unable to control the price of gasoline, diesel, and natural gas at home.
• In the wake of Russia’s invasion of Ukraine and the resultant economic uncertainty, calls for self-sufficiency are likely to be amplified.

Join Our Community

The U.S. oil and natural gas industry long fought for and in the last decade finally won release from federal restrictions that limited exports. The ostensible reason was that because of the so-called "shale revolution" in the country's oil and gas fields, the United States would have plenty of oil and gas to spare for export. The real reason behind the push was that the oil and gas industry wanted what almost every other industry in America already had: The right to sell their products to the highest bidders no matter where they lived on the globe.

This made it almost certain that as U.S. prices rose to match world prices, U.S. consumers would feel the pain. And, since energy prices affect everyone who votes, they are always politically consequential.

So, it is unsurprising that with U.S. regular gasoline prices over $5 per gallon President Joe Biden lashed out at U.S. oil companies—which are having one of their best years ever—saying they need to increase production of refined oil products. The companies have responded that their refineries are running at close to maximum capacity and so there is not much they can do in the short run.

What is left unsaid is that it has long been the policy of the United States to allow the export of refined (as opposed to crude) petroleum products such as gasoline, diesel, and heating oil. The country has a refinery capacity significantly in excess of domestic needs and so exports a considerable volume of refined products including about 1 million barrels per day (mbpd) of gasoline and 1.4 mbpd of diesel and heating oil (for the week ending June 10). If the U.S. were to curtail such exports in order to reduce prices at home, the country would be violating long-term commitments to free trade and free markets, and would be reducing supply and thus raising prices for customers abroad.

The boom in U.S. natural gas exports has also strained U.S. domestic natural gas supplies sending prices from less than $2 per thousand cubic feet (mcf) two years ago to about $7 per mcf today. (That's down from $9 recently.) That has meant sharply rising costs for residential and industrial heating and for natural gas-based plastics and other chemicals including nitrogen fertilizer derived from natural gas.

Related: Why Nuclear Energy Is More Relevant Than Ever

The boom in liquefied natural gas (LNG) exports now sends about 11 percent of U.S. natural gas production abroad (based on shipments from January through March 2022). The volume of LNG exports rose by a factor of 50 from  2011 through 2021. (See these numbers from the U.S. Energy Information Administration here and here.)

The world's free-trade advocates have long insisted that all commodities should circulate freely across the globe going to the highest bidder. These advocates also believed that government policies should not favor or subsidize one industry over another. The idea was crystallized in 1992 by Michael Boskin, chair of the White House Council of Economic Advisors under President George Bush, when Boskin was asked whether the United States should have a policy that encouraged domestic semiconductor production. He is reported to have said, "Potato chips, computer chips—what's the difference?"

Today, the country is talking about the very same issues. Does the United States need an industrial policy regarding semiconductors? Should the United States curtail oil exports? A debate on natural gas exports is likely to erupt soon.

It turns out that it really does matter whether a country produces potato chips or computer chips. In the wake of the Russia/Ukraine conflict which has resulted in the sudden breakdown and wrenching realignment of the global trading system countries around the world are grappling with shortages of food, fuel, and crucial industrial goods including semiconductors.

If nations increasingly decide that self-sufficiency and affordable domestic prices for exportable goods are more important than so-called free trade, look for many more dustups about whether governments should be more involved in setting industrial policies and determining what can and cannot be exported.

By Kurt Cobb via Resource Insights

More Top Reads From Oilprice.com:

• Outages And Reduced Russian Flows Send European Gas Prices Soaring
• Gazprom Neft CEO: Russia Already Exports Half Of Its Oil To Asia
• What Biden Is Getting Wrong About Big Oil’s Profits

https://oilprice.com/Energy/Energy-General/US-Oil-And-Gas-Exports-Are-Fueling-Higher-Domestic-Prices.html

[Tom Nolan + 2,443]

API Reports Biggest Crude Oil Inventory Rise Since February

By Julianne Geiger - Jun 22, 2022, 3:39 PM CDT

The American Petroleum Institute (API) reported a build this week for crude oil of 5.607 million barrels, while analysts predicted a draw of 1.433 million barrels.

It is the first build over 5 million barrels since mid-February, according to API data.

The build comes as the Department of Energy released 6.8 million barrels from the Strategic Petroleum Reserves in Week Ending June 17.

U.S. crude inventories have shed some 68 million barrels since the start of 2021 and about 11 million barrels since the start of 2020, according to API data.

In the week prior, the API reported a build in crude oil inventories of 736,000 barrels after analysts had predicted a draw of 1.2 million barrels.

WTI was trading down on Wednesday at 3.88% moments before the release, sinking to $105.30 per barrel. Brent crude was trading down 3.38% on the day at $110.80.

U.S. crude oil production rose to 12 million bpd—the first increase in four weeks—for the week ending June 10—a 1.1 million barrels per day decrease from pre-pandemic times.

This week, the API reported a build in gasoline inventories of 1.216 million barrels for the week ending June 17, compared to the previous week's 2.159-million-barrel draw.

Distillate stocks saw an inventory draw of 1.656 million barrels for the week, compared to last week's 234,000-barrel increase.

Cushing saw a decrease of 390,000 barrels this week. Cushing inventories slipped to 22.615 million barrels in the week prior, as of June 10, according to EIA data—down by nearly two-thirds from 59.2 million barrels at the start of 2021, and down from 37.3 million barrels at the end of 2021.

At 4:37 pm, ET, WTI was trading down at $105.20 (-3.93%), with Brent trading down at $110.80 (-3.39%).

By Julianne Geiger for Oilprice.com

More Top Reads From Oilprice.com:

• China May No Longer Be A Pillar Of Growth For Global Oil Markets
• 4 Nations That Could Help Solve The Global Fuel Crisis
• Europe Faces “Red Alert” For Gas Supply As Russia Reduces Flows

https://oilprice.com/Latest-Energy-News/World-News/API-Sees-Biggest-Crude-Oil-Inventory-Rise-Since-February.html

[RichieRich216 + 454]

They are hiding the bad news about the situation they created, strangling fossil fuels.
 

They are trying to put lipstick on a (pig themselves) for the incredible amount of stupidity for pushing Go Green mandates!

[Danlxyz + 63]

Or it could be a strong economy is driving demand up but production is not keeping pace so gasoline stocks are being drawn down. The traders see this and bid higher.

[Tom Nolan + 2,443]

EXCERPT

U.S. refining capacity has shed more than 1 million bpd over the past two years, according to the Energy Information Administration, but, according to federal data cited by Seeking Alpha, the decline has been going on for much longer.

Since 1990, the data shows, some 86 refineries have been shut down in the U.S., translating in the loss of more than 5 million bpd in capacity.

U.S. oil producers, meanwhile, have been reluctant to boost production, prioritizing instead the return of cash to shareholders.

By Charles Kennedy for Oilprice.com

https://oilprice.com/Energy/Energy-General/Bidens-Gas-Tax-Suspension-Proposal-Falls-Flat-In-Congress.html

Biden's Gas Tax Suspension Proposal Falls Flat In Congress

By Charles Kennedy - Jun 23, 2022, 8:30 AM CDT

• Biden's four point plan asks legislators to suspend the federal tax on gasoline and diesel.
• Congress has expressed a lack of enthusiasm for any such gas tax holiday.
• Another criticism of the gas tax holiday is that it would strip funds out of the Highway Trust Fund.

[Tom Nolan + 2,443]

Cracking & Pivoting

by Tyler Durden

Thursday, Jun 23, 2022 - 12:49 PM

Authored by Steven Vannelli via Knowledge Leaders Capital blog,

The President yesterday asked Congress for a gasoline tax holiday to alleviate the cost of gasoline and diesel in the country. This is not the solution.

With the exception of a 200,000 barrel/day refinery in Garyville, Louisiana, built by Marathon Petroleum in July 2020, there has not been a gasoline/diesel refinery built since 1977. Environmental concerns, permits and lawsuits have restricted the construction of new refinery capacity for 45 years.

In the same month of the completion of the above refinery in 2020, refinery capacity in the US peaked. Since then, it has dropped by around one million barrels/day. Many refineries have been retooled to produce “green” energy liquids and others have been shut down.

While it has been suggested that the oil companies are not cooperating with the attempt to alleviate high-refined product prices by producing more refined product, this just simply isn’t true. Refinery capacity utilization is 93.7% currently, which is actually somewhat above the average for the last decade.

The result of the lack of refinery capacity is a lack of refined product production. Both gasoline and diesel production in the US, according to the Department of Energy, has been flat since 2015. For gasoline, production has been stuck at 10 million barrels/day while production for diesel has been stuck just under 5 million barrels/day.

This supply crunch has manifest into higher refined product prices than would be suggested by crude oil prices.

There are a couple of easy ways to illustrate this.

First, we can look at the 3-2-1 crack spread to see the surge in refined products. The 3-2-1 crack spread measures the profit on three barrels of oil refined into two barrels of gasoline and one barrel of diesel. While normally in the range of $10-$20, the spread has blown out to almost $60 due to refined product shortages.

Second, we can look at the difference in price between 93 octane gasoline, which is more expensive to refine, and 87 octane gasoline. The spread historically has oscillated between $10-$30, but it broke out of that range in March, right after the Russian invasion of Ukraine.

While it is painful to say, I think we need to see another pivot in policy.

Publicly shaming oil companies, using a false narrative of price gouging, enacting a gas tax holiday and proposing windfall profit taxes are not good ideas either. The US simply needs to pivot in its “green” policy and encourage greater domestic production of refined product. While this seems like the strikingly obvious answer, until the government pivots and actually incentivizes refined product production, this situation is likely to persist.

In Commerce City, Colorado, a suburb of Denver, produced oil is refined for sale in the Denver metro area. So, supplies should be more secure…they should. I arrived home from the mountains last weekend and, as I normally do, stopped in my neighborhood to refill my tank (after a 200-mile round trip to Vail) and the gas station was OUT OF GAS. While I was born in the 1970s, I wasn’t old enough to experience first-hand the gas lines. I just got my first taste…and I did not like it.

Fill ‘er up before you head out for the Fourth of July because if the Juneteenth holiday shortage is any prelude, the 4th is likely to be worse.

https://www.zerohedge.com/commodities/cracking-pivoting

[Tom Nolan + 2,443]

https://oilprice.com/Latest-Energy-News/World-News/Highest-Ever-July-4-Gasoline-Prices-Unlikely-To-Curb-US-Demand.html

Highest-Ever July 4 Gasoline Prices Unlikely To Curb U.S. Demand

By Tsvetana Paraskova - Jun 23, 2022, 11:30 AM CDT

U.S. drivers are facing the highest gasoline prices for the 4th of July on record, but these are unlikely to curb Americans' appetite for road trips this summer, analysts at fuel-savings app GasBuddy said on Thursday.

Gasoline prices are expected to drop by 10 to 20 cents from now until Independence Day, although it's not a given that the decline will stick, according to GasBuddy.

Over the past week, international crude oil prices—the single biggest factor in U.S. gasoline pricing—have slumped to around $110 per barrel due to market fears that the aggressive interest hikes to curb inflation would lead to a recession within a year.

 

Still, gasoline prices for Independence Day this year are set for a record national average for July 4 at $4.85 per gallon, GasBuddy has estimated.

Drivers were already determined to get out on the road for Independence Day despite the high prices and before the most recent small relief at the pump, GasBuddy noted on Thursday.

"It's been a scorching summer at the pump with record prices set in every state. While we may see brief relief here and there, the high prices don't seem to be holding many Americans back from hitting the road with the economy fully reopen," said Patrick De Haan, head of petroleum analysis at GasBuddy.

"While we may see relief as we approach July 4, and potentially after, the volatility in markets remains high. We still could see a super spike in gas prices later this summer, should a hurricane threaten Gulf Coast oil refineries or oil platforms. Motorists should know that while we may see small relief today, risks remain that prices could go up at a moment's notice and set new records again," De Haan warned. 

Desperate to bring prices down, President Joe Biden called on Congress on Wednesday to suspend the federal gas tax for the next 90 days. However, resistance in Congress—even from the President's own party—could stymie the idea altogether.

By Tsvetana Paraskova for Oilprice.com

More Top Reads From Oilprice.com:

• China May No Longer Be A Pillar Of Growth For Global Oil Markets
• 4 Nations That Could Help Solve The Global Fuel Crisis
• Europe Faces “Red Alert” For Gas Supply As Russia Reduces Flows

[Tom Nolan + 2,443]

https://oilprice.com/Latest-Energy-News/World-News/Dallas-Fed-Surging-Costs-Hamper-US-Shale-Growth.html

Dallas Fed: Surging Costs Hamper U.S. Shale Growth

By Tsvetana Paraskova - Jun 23, 2022, 2:15 PM CDT

The business activity index in the energy firms operating in Texas, northern Louisiana, and southern New Mexico jumped in the second quarter to the highest level in six years, but costs continue to escalate and supply chain delays are worsening, the Dallas Fed Energy Survey showed on Thursday.  

Activity in the oil and gas sector in the most prolific U.S. shale basin, the Permian, expanded at a robust pace in the second quarter, with the business activity index—the survey’s broadest measure of conditions facing energy firms—up from 56.0 in the first quarter to 57.7, registering its highest reading in the survey’s six-year history, the Dallas Fed said.

For a sixth quarter in a row, costs have risen this quarter, according to the survey of oil and gas executives at 85 exploration and production firms and 52 oilfield services firms.

 

The index for input costs at the oilfield services companies jumped to a record high, and none of those firms responding in the survey reported lower costs. 

Delivery times for materials and equipment for the industry are rising, with many executives reporting significant delays.

Nearly half of the executives—47 percent—said supply-chain issues have a “significantly negative” impact on their firms, and another 47 percent see slightly negative impact. Just 6 percent of executives said their firms are experiencing no supply-chain issues or impacts. Moreover, most executives – or 66 percent – expect it will take more than a year to resolve supply-chain issues.

In comments to the survey, an E&P executive said “We are experiencing significant delays in obtaining materials and services, and costs are substantially increasing. We will shortly be ceasing investment in any new operations owing to the combination of rising costs, supply-chain slowness and our view that a recession is coming that will drop oil and natural gas prices significantly.”

“Huge service cost increases, regulatory uncertainty and mixed messages from Washington are keeping me on the sidelines,” another executive noted.

One executive at an oilfield service firm commented: “The supply chain seems stretched to the max in the Permian Basin. There really is not much ability to increase drilling activity.”

By Tsvetana Paraskova for Oilprice.com

More Top Reads From Oilprice.com:

• China May No Longer Be A Pillar Of Growth For Global Oil Markets
• 4 Nations That Could Help Solve The Global Fuel Crisis
• Europe Faces “Red Alert” For Gas Supply As Russia Reduces Flows

[Tom Nolan + 2,443]

https://oilprice.com/Energy/Energy-General/Oil-Prices-Bounce-As-EIA-Fails-To-Publish-Inventory-Data.html

Oil Prices Bounce As EIA Fails To Publish Inventory Data

By Tom Kool - Jun 24, 2022, 2:00 PM CDT

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The world's most-watched oil data report won't be released this week due to a power problem. Oil prices, meanwhile, are climbing higher on Friday to cancel out losses from earlier in the week.

Disruptions, disruptions, and disruptions. Even the Energy Information Administration can't avoid them, with electricity problems meaning the world's most-watched oil data report won't be released this week. Preliminary estimates pointed to the largest crude stock build in the past four months. The EIA hopes to shed more light on that on Monday. Meanwhile, the US Federal Reserve’s unconditional focus on taming inflation continues to squeeze speculators out of the Brent and WTI futures contracts. This means that, despite backwardation being almost as steep as it was at the peak of the market madness in March, prices have barely moved this week, with ICE Brent around the $112 per barrel mark. 

Russian Gas Cuts Top EU Agenda. Arguing that it is only a matter of time until Russia shuts down all gas shipments to Europe, this week’s meeting of EU leaders focuses on the need to seek alternative supplies as the continent’s 40% dependence puts its energy-hungry industry on the brink. 

Texas Helps Cheniere Avoid Pollution Limits. According to Reuters, the Texas state regulators have repeatedly increased the pollution limits of Cheniere’s (NYSEAMERICAN:LNG) liquefaction plant in Corpus Christi, TX, doubling it over the past eight years instead of slapping fines on the emitter. 

LNG Squeeze Pushes Asian Prices. As Europe’s gas squeeze and the force majeure at Freeport LNG narrowed down the options of spot buyers, LNG prices in Asia have also seen strong upwards momentum, trending around $37-38 per mmBtu as Asian gas stock replenishment rates lag European ones. 

Ecuador Crude Output Still Blocked by Protests. Ecuadorian crude production dropped 45% in less than a decade, currently averaging 275,000 b/d, as protests of indigenous nationalities demanding fuel subsidies saw them invade and vandalize at least a dozen of oil fields and risk pipeline supply to the country’s ports. 

US Refining Capacity Drops to Lowest Since 2014. According to IEA data, US refinery capacity fell below the 18 million b/d mark at the beginning of 2022 (at 17.94 million b/d), marking the lowest level of operable downstream capacity since 2014.

Gunvor Lobbies for a Jones Act Waiver. The trading firm Gunvor has formally requested a waiver from the Jones Act, stipulating that any blending onboard a vessel in a foreign port cannot create new product, to deliver some 13 million gallons of gasoline into the US, marking the first time traders have tried this shortcut. 

Mexico Just Cannot Stop Flaring. Amidst news of PEMEX’s excessive natural gas flaring at its legacy shallow water fields, Mexico’s hydrocarbon regulator CNH went on surprise visits to the Mexican oil firm’s latest development projects and found similar levels of flaring at the up-and-coming Quesqui and Ixachi fields, too. 

London and Berlin Push For Biofuel Mandate Stop. Negotiators from European G7 countries, primarily Britain and Germany, will push for temporary waivers on biofuels mandates to tame runaway food prices at the upcoming meeting in Bavaria, wary of increasing food vs biofuels crop competition.

China Wants More Exploration in East China Sea. Brushing aside Japanese accusations of building two unwarranted drilling platforms not far away from the disputed Senkaku/Diaoyu islands, China reiterated its interest in developing its oil and gas resources in the East China Sea, a move Beijing considers to be justified under its sovereign rights. 

Unfazed by Court Freeze, Shell Wants to Quit Nigerian Onshore. With Nigeria’s Supreme Court barring UK energy firm Shell (LON:SHEL) from selling its onshore Nigerian assets amidst an ongoing 2 billion compensation case that revolves around a 2019 oil spill, the major reiterated its interest to leave the country. 

Chevron Takes Up Huge LNG Term Commitments. US oil major Chevron (NYSE:CVX) signed two LNG supply deals to buy 2mtpa from both Cheniere Energy (NYSEAMERICAN:LNG) and Venture Global, presumably starting from 2026 as Chevron wants a larger share of the LNG trading market. 

EU Finally Agrees on Carbon Reform. Following a failed attempt earlier this month, the European Parliament agreed to reform the EU carbon market by phasing out all CO2 permits by 2032 and expanding emissions trading into international shipping, both to and from EU countries. 

Apache-Total Tandem Strikes Oil in Suriname. Suriname's offshore prospects received a much-needed boost after APA (NASDAQ:APA) and TotalEnergies (NYSE:TTE) discovered more than 180 million barrels with the Krabdagu-1 well in Block 58, abutting the oil-prolific Stabroek block of Guyana. 

P66 Runs into Permitting Trouble. US refiner Phillips 66 (NYSE:PSX) has been accused of California regulators of improperly processing renewable diesel from soybean oil at its Rodeo, California refinery, namely without modifying its existing air permit.

By Tom Kool for Oilprice.com

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