The Fort McMurray wild fire remains uncontained and Oil Sands operators are either shut down or running at reduced rates. ESAI Energy estimates total Oil Sands production of synthetic crude oil and non-upgraded bitumen will average 1.5 million b/d in May, about 720,000 b/d lower than April production of 2.2 million b/d.
As part of the fallout from the disruption of bitumen production in Alberta due to the Fort McMurray wild fire, Canada will require much less diluent from the U.S. The loss of at least 300,000 b/d of bitumen production that is not upgraded implies the elimination of nearly 100,000 b/d of diluent demand.
Turkey Drives European Product Demand Growth With economic growth forecast to outpace the rest of Europe and a sustained influx of migrants expected due to the continuing violence in Syria and the migrant deal with the EU, Turkey is expected to account for about 65,000 b/d, or half of total European product demand growth in…
Elevated inventories of middle distillates and (now) gasoline are pressuring spreads to crude. Our outlook for gaso-line fundamentals calls for more “normal” conditions to return to the gasoline market after a period of extraordinary tightness, and strength in spreads to crude.
Global inventories of middle distillate and gasoline have reached critical levels where they are simultaneously preventing any recovery in diesel and jet fuel spreads to crude, and introducing more “normal” conditions to a previously tight gasoline market. The result should be a more typical
Reuters: May 12, 2016
“The good news is the world is swimming in crude oil, so there are options. This may make it economical to ship Eagle Ford crude or maybe ship in some North Sea crude,” Sarah Emerson, a managing principal at ESAI ENERGY LLC, said.
Low Venezuelan Throughput Threatens PetroCaribe In the wake of a series of severe refinery disruptions, ESAI Energy has revised down its expectations for Venezuelan throughput for the middle part of 2016. Those revisions, from already low utilization rates have led our expectations for balances in the country and the wider Caribbean Basin to deteriorate further…
Unofficial Commercial Crude Stocks Rising Despite moderate oil product demand growth of 310,000 b/d, China is expected to increase net crude imports by 450,000 b/d to 7.1 million b/d in 2016. ESAI Energy believes in addition to over 70 million barrels of SPR fill and official commercial crude stock build, up to 90 million barrels…
Interaction of Global Gasoline, Condensate and Petchem Markets to 2025
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While the ceasefire may not last, and a near-term political settlement in Syria is unlikely, ISIS’s prospects in both Iraq and Syria appear to be decreasing. Do not expect enough political stability in either country to allow for consistent economic growth.
EU-16 transport fuel demand is expected to increase by an annual average of less than a 60,000 b/d in 2016 and 2017, a far cry from growth of nearly 130,000 b/d in 2015. Diminishing demand growth will limit the recovery of a weak global distillate market and keep regional diesel refining margins low.
Reuters: April 20, 2016
Sarah Emerson, a managing principal at ESAI Energy LLC, says the return of Algerian crude to the East Coast was expected given the collapse of the discount U.S. crude once enjoyed against Brent, the global benchmark. Low prices make it nearly impossible