01-12-05
The US Energy Information Administration said that the US needs to import
"well above" 10-mm bpd of crude in order to prevent a sharp drop in stocks with
colder weather and improved refinery utilization rates on the horizon.
"As refineries continue to increase their throughput, crude oil inventories
could fall, as they did in today’s data release for last week, unless imports
average well above 10 mm bpd."
The EIA, in its Petroleum Report, said that a continued import rate of 9.7-mm
bpd, as was the case earlier, would likely result in "substantial drops" in US
crude stocks.
"Either crude oil inventories will likely begin a sustained drop or US
refineries will need to continue to buy imported crude oil at relatively strong
rates," the agency said. "Either way, this could put some upward pressure on WTI
prices in the coming weeks."
The EIA noted the US cannot expect much help on the domestic front, with
about 37 % of US Gulf crude production still curtailed in the aftermath of
hurricanes Katrina and Rita and the bulk of that output likely not be restored
for months.
"With refinery throughput already over 15.1-mm bpd, and possibly heading towards
15.5-mm bpd or higher over the next several weeks... simple subtraction
indicates that crude oil imports will need to average well above 10-mm bpd to
keep crude oil inventories from falling," the agency said.
Crude stocks fell 4.2-mm bbl earlier, EIA said in its weekly petroleum
report. The agency, the statistical section of the US Department of Energy, also
cautioned that the recent sharp drop in retail gasoline prices will be slowed
should crude prices rise, or even remain flat. Under that scenario, the nation's
average retail price may not fall to $ 2/gal from its current $ 2.15/gal,
according to EIA.
"Recent wholesale price trends suggest that while retail gasoline prices may
fall a little bit more over the next week or two, price movements beyond that
timeframe will be influenced by the trend in crude oil prices," it said.
Source: PetroleumWorld