Oil Prices shook off a disappointing gasoline demand number as Fed Chair Janet Yellen came to the rescue. Oil prices that have been held back by Greece default concerns are now being assured by the Fed that they are monitoring international developments and will take that into consideration when raising interest rates. In other words, if Greece defaults and leaves the Eurozone then the Fed will stand pat and not raise rates until the turmoil passes. They will keep liquidity and weaken the dollar and increase oil demand. Fed Chair Yellen said she can’t promise that the markets won’t be volatile when she decides to raise rates but it may be volatility from the Greek fallout that will keep them on hold.
So, is there any hope for a Greek deal? German Chancellor Angela Merkel thinks so but hardly anyone else of note does. Greek Prime Minister Alexis Tsipras is blaming his creditors for their handling of the crisis, maybe because they should not have lent Greece money in the first place. He told Germany that his country is not a country of freeloaders.
Oil might have seen new highs for the year but the Energy Information Administration raised questions about the recent rapid strength in demand.
The EIA reported that U.S. crude oil refinery inputs averaged 16.3 million barrels per day during the week ending June 12, 2015, 294,000 barrels per day less than the previous week’s average. Refineries operated at 93.1% of their operable capacity last week. Gasoline production decreased last week, averaging about 9.7 million barrels per day. Distillate fuel production decreased last week, averaging over 5.0 million barrels per day.
U.S. crude oil imports averaged about 7.1 million barrels per day last week, up by 444,000 barrels per day from the previous week. Over the last four weeks, crude oil imports averaged over 6.9 million barrels per day, 5.3% below the same four-week period last year. Total motor gasoline imports (including both finished gasoline and gasoline blending components) last week averaged 682,000 barrels per day. Distillate fuel imports averaged 147,000 barrels per day last week. U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) decreased by 2.7 million barrels from the previous week. At 467.9 million barrels, U.S. crude oil inventories remain near levels not seen for this time of year in at least the last 80 years. Total motor gasoline inventories increased by 0.5 million barrels last week, and are in the upper half of the average range.
Both finished gasoline inventories and blending components inventories increased last week. Distillate fuel inventories increased by 0.1 million barrels last week but are in the lower half of the average range for this time of year. Propane/propylene inventories rose 1.9 million barrels last week and are well above the upper limit of the average range. Total commercial petroleum inventories increased by 2.7 million barrels last week.
Total products supplied over the last four-week period averaged about 19.7 million barrels per day, up by 5.2% from the same period last year. Over the last four weeks, motor gasoline product supplied averaged almost 9.4 million barrels per day, up by 3.3% from the same period last year. Distillate fuel product supplied averaged over 3.9 million barrels per day over the last four weeks, down by 2.1% from the same period last year. Jet fuel product supplied is up 4.9% compared to the same four-week period last year.