In an oil and gas report sent to Rigzone by the Macquarie team on Tuesday, Macquarie strategists revealed that they are forecasting that U.S. crude inventories will be up by 2.7 million barrels for the week ending July 4.
“This follows a 3.8 million barrel build in the prior week, with the crude balance realizing significantly looser than our expectations,” the strategists stated in the report.
“For this week’s crude balance, from refineries, we model a minimal reduction in crude runs. Among net imports, we model a sharp reduction, with exports up (+0.7 million barrels per day) and imports down (-0.6 million barrels per day) on a nominal basis,” they added.
In the report, the strategists warned that the timing of cargoes remains a source of potential volatility in this week’s crude balance.
“From implied domestic supply (prod.+adj.+transfers), we look for a bounce (+1.2 million barrels) on a nominal basis this week,” the strategists went on to state in the report.
“Rounding out the picture, we anticipate another small increase in SPR [Strategic Petroleum Reserve] stocks (+0.2 million barrels) this week,” they added.
The Macquarie strategists also noted in the report that, “among products”, they “look for across the board builds (gasoline/distillate/ jet +1.0/+2.4/+1.1 million barrels)”.
“We model implied demand for these three products at ~14.3 million barrels per day for the week ending July 4 amidst holiday effects,” they added.
“On this front, while the week of July 4th typically sees a large reduction to distillate demand, the timing/magnitude of this impact could potentially be affected/reduced by the holiday falling on a Friday this year,” the strategists went on to note.
In its latest weekly petroleum status report at the time of writing, which was released on July 2 and included data for the week ending June 27, the U.S. Energy Information Administration (EIA) highlighted that U.S. commercial crude oil inventories, excluding those in the SPR, increased by 3.8 million barrels from the week ending June 20 to the week ending June 27.
That EIA report showed that crude oil stocks, not including the SPR, stood at 419.0 million barrels on June 27, 415.1 million barrels on June 20, and 448.5 million barrels on June 28, 2024. The report highlighted that data may not add up to totals due to independent rounding.
Crude oil in the SPR stood at 402.8 million barrels on June 27, 402.5 million barrels on June 20, and 372.6 million barrels on June 28, 2024, the EIA report revealed. Total petroleum stocks – including crude oil, total motor gasoline, fuel ethanol, kerosene type jet fuel, distillate fuel oil, residual fuel oil, propane/propylene, and other oils – stood at 1.642 billion barrels on June 27, the report pointed out. Total petroleum stocks were up 9.6 million barrels week on week and down 12.8 million barrels year on year, the EIA report showed.
An oil and gas report sent to Rigzone by the Macquarie team on June 30 revealed that Macquarie strategists were forecasting that U.S. crude inventories would be down by 1.3 million barrels for the week ending June 27.
“This follows a 5.8 million barrel draw in the prior week, with the crude balance again realizing significantly tighter than our expectations amidst another week of disappointing net imports,” the Macquarie strategists stated in that report.
U.S. commercial crude oil inventories, excluding those in the SPR, dropped by 5.8 million barrels from the week ending June 13 to the week ending June 20, the EIA highlighted in its weekly petroleum status report released on June 25.
To contact the author, email andreas.exarheas@rigzone.com
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