The Energy Bulletin Weekly: 15 June 2020 - Resilience

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The Energy Bulletin Weekly: 15 June 2020 - ResilienceThe Energy Bulletin Weekly: 15 June 2020 - ResiliencePosted: 15 Jun 2020 12:00 AM PDTTom Whipple and Steve Andrews, EditorsQuotes of the Week"Losses this year will be the biggest in aviation history. There is no comparison for the dimensions of this crisis." Alexandre de Juniac, Int'l Air Transportation Assoc.'s CEO"It remains unclear if oil demand will ever return to pre-pandemic levels. From the destruction of the aviation industry to the transformation of workplace dynamics reducing daily travel and governmental pushes for renewable energy, oil demand is being attacked on all sides due to COVID-19. The oil majors seem to have recognized this global shift and are determined to make their operations as lean and sustainable as possible. 2020 is shaping up to be the most dramatic year in the history of oil markets, with a decade's worth of change seeming to be taking place in just 365 days." Charles Ke…

U.S. Commercial Crude Oil Stocks Hit Record High - OilPrice.com

The United States held a record-high level of commercial crude oil inventories as of the week to June 19 following the collapse in demand in the lockdown and the slow demand recovery after lockdowns were lifted, data from the Energy Information Administration (EIA) showed on Monday.

In its latest Weekly Petroleum Status Report, the EIA reported a 1.4-million-barrel increase in crude oil inventories for the week to June 19. At 540.7 million barrels, U.S. crude oil inventories are still above the five-year average for this time of the year, and demand improvement seems to be going more slowly than hoped, as suggested by the change in fuels.  

At nearly 541 million barrels of crude oil inventories for the week to June 19, the U.S. beat by 5 million barrels its previous record for the highest volume of commercial inventories from late March 2017, EIA data showed.

As of June 19, U.S. net commercial crude oil inventories were at 62 percent of total available storage capacity.

Commercial crude oil inventories in the U.S. Gulf Coast have jumped by 63 million barrels since March 13, when a national emergency was declared in the United States. The Gulf Coast inventories are currently sitting at an all-time high of 249 million barrels, according to the EIA.

However, the capacity utilization of the crude oil storage at Cushing, Oklahoma, dropped to 58 percent on June 19, from 83 percent capacity filled on May 1, the EIA has estimated. Fears of overflowing storage sent WTI Crude prices – based on physical delivery of WTI crude oil at Cushing – below zero on April 20 and 21.  

Demand, especially gasoline demand, in the U.S. has been recovering from the April lows, but it is still well below the levels typical for this time of the year. Refinery capacity utilization is rising much slower as refiners and the market have to draw down excess inventories that surged at the start of the lockdowns.

By Charles Kennedy for Oilprice.com

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