U.S. oil exports and natural gas bottom
Questions continue to arise regarding the possibiitly of U.S. crude oil (NYMEX:CLV14) export ban as an abundance of U.S. oil makes it more likely that oil will go elsewhere.
Genscape Vesseltracker reported that Alaskan crude oil has been exported outside of the United States since 2004. This is another step in lifting the 1970's oil ban that already has been challenged by U.S. exports of "condensate" that does not quite fit our traditional definition of what crude oil is. Genscape monitoring data showed that a cargo of Alaskan North Slope crude loaded Sept. 26 at the Alaskan port of Valdez for delivery into the South Korean refining center of Yeosu. Yeosu they say is home to a GS Caltex-operated 775,000 bpd refinery, the world's fourth largest. The vessel, Polar Discovery, is expected to arrive onOctober 10.
U.S. export of oil is just one small reason why the Brent/WTI spread came in to the lowest level in a year. Pro-democracy protests in Hong Kong won't really inspire thoughts of demand growth in China. U.S. economic data is a contrast to European struggles. Europes economy is struggling and there is concern that the WTI should be on target to go premium over Brent. Yet a slight break in the dollar and a rash of refinery issues helped give both benchmarks a boost. Bloomberg News reported that Unit 40 fluid catalytic cracker at Texas refinery is scheduled for maintenance starting today until Oct. 31, according to TCEQ filing.
They also reported that the Petrobras Pasadena refinery will cut rates for 20-25 days on Sept. 29. Bloomberg Reported that the Petrobras Pasadena, Texas, refinery will operate at 90k b/d while conducting planned work on a fluid catalytic cracker. The company also reported that the Exxon Baytown will keep biggest FCC shut till mid-October.
Natural Gas (NYMEX:NGV14) saw a huge short covering rally on the October expiration. While the market could pull back more than likely the recent range would suggest a seasonal bottom. With supply 12.5% below the five-year average and with winter coming it may be time to start buying. Bears are starting to worry as gas hit a a 2-month high!
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