BlackMask Breaking News

Summary of Weekly Petroleum Data for the week ending October 04, 2024

 

U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) increased by 5.8 million barrels from the previous week. At 422.7 million barrels, U.S. crude oil inventories are about 4% below the five year average for this time of year.  U.S. crude oil refinery inputs averaged 15.6 million barrels per day during the week ending October 04, 2024, which was 101 thousand barrels per day less than the previous week’s average. Refineries operated at 86.7% of their operable capacity last week. Gasoline production increased last week, averaging 10.2 million barrels per day. Distillate fuel production increased last week, averaging 5.0 million barrels per day. U.S. crude oil imports averaged 6.2 million barrels per day last week, decreased by 389 thousand barrels per day from the previous week. Over the past four weeks, crude oil imports averaged about 6.4 million barrels per day, 2.5% less than the same four-week period last year. Total motor gasoline imports (including both finished gasoline and gasoline blending components) last week averaged 48 thousand barrels per day, and distillate fuel imports averaged 104 thousand barrels per day.  Total motor gasoline
inventories decreased by 6.3 million barrels from last week and are about 4% below the five year average for this time of year. Finished gasoline and blending components inventories both decreased last week. Distillate fuel inventories decreased by 3.1 million barrels last week and are about 9% below the five year average for this time of year. Propane/propylene inventories increased by 1.9 million barrels from last week and are 9% above the five year average for this time of year. Total commercial petroleum inventories decreased by 8.1 million barrels last week.
Total products supplied over the last four-week period averaged 20.6 million barrels a day, up by 2.9% from the same period last year. Over the past four weeks, motor gasoline product supplied averaged 9.0 million barrels a day, up by 7.5% from the same period last year. Distillate fuel
product supplied averaged 3.9 million barrels a day over the past four weeks, down by 0.9% from the same period last year. Jet fuel product supplied was up 9.2% compared with the same four-week period last year

 

ING commodities strategists Warren Patterson and Ewa Manthey wrote in a note on Tuesday  “China’s National Development and Reforms Commission (NDRC) failed to announce any new supportive measures. Without policy support, an economic slowdown could keep China’s oil demand subdued in the short to medium term,”.

 PMV   oil brokerage    said in a Tuesday note.    The return of Libya’s oil production and exports after more than a month of hiatus due to the political stalemate has also weighed on the prices. “Oil can keep ascending only for so long purely based on perceptions and not actual supply disruption,”  “The geopolitical risk premium has an obscure and unforeseeable expiry date. When that point arrives and is not replaced by genuine and supportive fundamental factors, in the case of the Middle East conflict by a palpable supply shortage, the move higher will not be sustainable.”

Omega Intranational Trust analyst  Nick Guarino in a on line Pod Cast warned “after the elections and especially if Tromp wins oil could go over $150 barrel. The US and Israel are adamant a radicalized Iran should never be allowed to have nukes”

NN BlaskMask Pod Cast:

Iranian Never Never Land

Crude oil prices experienced a further decrease on Tuesday as the lingering conflict in the Middle East and concerns regarding demand, particularly from China, persist. Investors are closely monitoring Israel’s potential response to last week’s missile attack from Iran, with Iran’s oil facilities considered a possible target. West Texas Intermediate (WTI) for settlements in November fell by 4.63% at 10:44 am ET and sold for $73.67per barrel. Brent for December deliveries slumped by 4.40% a minute later, going for $77.38 per barrel.

 

Prime Minister Benjamin Netanyahu vowed Monday that Israel will continue to fight as long as its existence is threatened. “As long as the enemy threatens our existence and the peace of our country, we will continue to fight,” the prime minister said at the state’s memorial ceremony to mark one year since the October 7 attack. He emphasized that Israel’s objectives include defeating Hamas, rescuing hostages, and preventing future threats from Gaza, vowing that no hostage will be left behind.

Netanyahu finally reaffirmed that Israel’s fight is not just for today but for future generations, stating, “Together — with God’s grace — we will win.”

Israel will soon respond to Iran’s missile attack on October 1, Israel’s Channel 13 reported on Monday, citing an unnamed United States security official. No further details were provided. Previously, Israel vowed to retaliate against Iran amid ongoing speculations about whether the potential attack would target the country’s oil fields. Today marks the anniversary of the beginning of the conflict between Israel and Hamas in Gaza which also led to a significant escalation with Hezbollah in the Israel-Lebanon border, culminating in the assassination of the militant group’s leader Hassan Nasrallah in Beirut and Iran’s missile attack on Israel. NN: The plan is to sell into the Israel attack on Iran

United States Vice President and Democratic presidential nominee Kamala Harris said in an interview set to be broadcast on Monday that the US needs to help Israel to “defend itself” from the threats posed by Hamas, Hezbollah and Iran. “When we think about the threat that Hamas, Hezbollah… Iran present, I think that it is without any question, our imperative to do what we can to allow Israel to defend itself against those kinds of attacks,” Harris said in a preview of the CBS’ 60 Minutes.  “The aid that we have given Israel allowed Israel to defend itself against 200 ballistic missiles that were just meant to attack the people of Israel,” she added, referring to Iran’s recent missile attack on the country, which it launched in response to Israel’s bombing of Beirut that killed Hezbollah leader Hassan Nasrallah.

Walz: Iran at the heart of disruption in Middle East

Democratic vice-presidential candidate Tim Walz claimed in an interview with Fox News on Sunday that Iran is “at the heart of” the crisis in the Middle East, asserting that Tehran’s “proxies … bring disruption throughout the region.” “We have been clear Israel has the right to defend itself. We’ve always stood in that position,” Walz insisted and pointed out that it was Hamas that started the conflict by killing “over 1,200 innocent Israelis” and taking 46 Americans hostage. “We have always said we reserve the right to protect American troops, our allies in the region, and that there is consequences for Iran,” he added. The comments come amid Israel’s intensified attacks on Gaza and Lebanon and threats it would target Iran in response to Tehran’s strikes on the country earlier this week.  NN: These 2 WOK JOKES  will sell out Israel faster than a Hamas terrorist will rape and torture a 12 year old Jewish girl.

Oil pared gains after President Joe Biden sought to discourage Israel from attacking Iran’s oil fields.
West Texas Intermediate rose 0.9% to settle above $74 a barrel on Friday, after earlier surging as much as 2.5%. The advance faded after Biden told reporters at the White House, regarding Israeli’s potential retaliation against Iran for its recent missile strike, “If I were in their shoes I would think of other alternatives than attacking oil fields.”
Crude still soared 9.1% this week — the biggest weekly advance since March 2023 — as the escalation of hostilities raises the possibility of disruption to Middle East oil supplies. While Israel and Iran, as well as Tehran’s proxies in Lebanon, Gaza and Yemen, have been facing off for the past year, this week’s flare-up is stoking fears of an all-out conflict that could drag in other countries. Iran fired a barrage of missiles into Israel earlier this week after Israel stepped up its offensive against Tehran-backed Hezbollah, including by sending troops into southern Lebanon. The Group of Seven nations has called on countries in the region to “act responsibly and with restraint.”

The Middle East accounts for about a third of the world’s crude supply. Iran has been pumping about 3.3 million barrels a day in recent months, making it the No. 3 producer in the Organization of Petroleum Exporting Countries.

SEB AB’s Bjarne Schieldrop, chief commodities analyst said “While probabilities for worst-case scenarios are very low, everyone is still biting nails for what will happen in the coming days as we await the retaliatory attack by Israel on Iran,”

Citigroup Inc. has estimated that a major strike by Israel on Iran’s export capacity could take 1.5 million barrels of daily supply off the market. If Israel struck minor infrastructure, 300,000 to 450,000 barrels may be lost. There’s also concern that Tehran might raise the stakes by targeting energy infrastructure in neighboring states or supply routes such as the critical Strait of Hormuz.

Clearview Energy Partners said an interruption of flows through the waterway at the mouth of the Persian Gulf could drive crude $13 to $28 a barrel higher. NB: that puts Brent over $105 a barrel.

ANZ Group Holdings Ltd An attack by Israel against Iran’s oil facilities is the “least likely” option. Such a move would upset Israel’s partners, including the US, and may also induce a more severe response from Tehran, analysts Daniel Hynes and Soni Kumari said in a report.

Bridgeton Research Group. reported commodity trading advisers, which largely rely on trend-following algorithms, flipped to a net long position in Brent by Friday, compared with being net short by about 55% on Tuesday, according to proprietary data.

Cayler Capital’s  Brent Belote said “The underlying physical market is not reflecting the $7 rally we have seen over this past week,” said  . “This may give a great opportunity to be short should cooler heads prevail.”

Options markets are flashing warning signs as investors bet that oil could rise further. West Texas Intermediate calls, which profit from price gains, were at the widest premium to the opposite puts in 2 1/2 years as of Thursday’s close. Implied volatility has also spiked. NB: a lot of the stupid money has gone long oil. The  crisis has also started to ripple through to the shipping sector, with earnings for oil tankers rallying since the most recent escalation. Iran appears to have moved some of its vessels away from a key oil loading terminal.

So all this begs the Question WHERE WILL Israel attack?

We have spent the past few days analyzing the possible targets. First of all Iran’s nuclear facilities are off the table for now. Its impossible for Israel to pull this off without Americas assistance. And creepy Joe Biden is  dead set against it. Is a go when Trump gets reelected president.

So its down to Iran’s  oil infrastructure doable by Israel alone.  Below our  target list and the potential impact on or oil trade:

The extent of the market impact depends on the chosen targets and scale of a possible attack. Our market intelligence comes down to four sites of  oil strategic importance come to mind.

1. Kharg Oil Terminal, situated on Kharg Island, 15 miles off Iran’s northwestern coast. It handles over 90% of the country’s global crude oil exports. It is heavy defended by the Russia SU400 anti aircraft missile system. If this target is selected and successful its good for a $5.00 a barrel increase in a knee jerk reaction.
2. Kish Islands Is a cluster of oil terminals in the Southern province of Hormozgan. It also has two free trade zones on Kish and Qeshm Islands. Kish is also home of the Iranian oil bourse — the only exchange of its kind that does not trade oil and derivatives in U.S. dollars. A insignificant target exporting less than 10% of Iran’s production.
3.  Abadan Refinery for domestic consumption. Located across Shatt Al-Arab River on the border between Iraq and Iran. The refinery’s production capacity is  estimated to be producing around 400,000 bpd. As Iran’s oldest processing facility — originally built in 1909 by Anglo-Persian oil (which later became BP) — it services around 25% of Iran’s domestic fuel demand.
4. Mahshahr Oil Terminal, an oil port located on the Khor Musa Channel. It stores and shifts products from the Abadan Refinery, and serves as an engineering and jetty construction hub for Iran.

Should the Abadan Refinery be targeted, it may cripple Iran’s domestic fuel supply chain. It being knocked offline  does not carry any significant international implications

NN: For further information see BlaskMask Market News and Commentary titled: THE SAFEST BET

Hezbollah leader Hashem Safieddine, expected to succeed Hassan Nasrallah, has been unreachable since an Israeli airstrike in Beirut targeted an underground bunker, according to three Lebanese security sources on Saturday. The strike hit Hezbollah’s intelligence headquarters in the southern suburbs of the city. Rescue efforts have been hindered by ongoing airstrikes in the area, making it challenging to confirm Safieddine’s fate. The Israel Defense Forces (IDF) confirmed the attack on Hezbollah’s intelligence hub but did not disclose who was inside the bunker. NN: A job to die for

Fawzia Amin Sido was sold by the terror group to a Gazan man in 2014; now 21, she has been reunited with her family in Iraq

Yazidi woman Fawzia Amin Sido (R), who was kidnapped by ISIS in Iraq in 2014 and then transferred to Gaza, Oct. 3, 2024, seen back in Iraq after being rescued recently by Israeli security forces. Iraq made no official mention of Israel’s role. (Iraqi Ministry of Foreign Affairs) A Yazidi woman who was kidnapped from Iraq by ISIS in 2014 at the age of 11 and trafficked to the Gaza Strip has been rescued and reunited with her family. The rescue and return home of Fawzi Amin Sido was announced separately by the foreign ministries of Israel and Iraq. Israel’s foreign ministry said Sido was taken from her family in 2014 amid ISIS attacks on Yazidi communities in Iraq, as the terror organization known for its brutalities took control of vast swaths of the country. She was then sold off to a Gazan man who was visiting Iraq at the time. Israeli security forces recently extracted Sido and returned her home. In a later statement, the Israel Defense Forces, said that Sido was rescued in a complex operation coordinated by the IDF’s COGAT and the US Embassy in Jerusalem, together with “other members of the international community.” The IDF said that the “terrorist who had been holding her” was recently killed, apparently in an Israeli strike during the fighting in Gaza, allowing her to flee to a hiding place in Gaza. “The young girl was extracted from the Gaza Strip in recent days in a secret operation through the Kerem Shalom crossing. After crossing into Israel, she was taken to Jordan via the Allenby Crossing and then on to her family in Iraq,” the IDF said.