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This Week In Petroleum EIA Home > Petroleum > This Week In Petroleum |
Released on March 9, 2005
(Next Release on March 16, 2005)
EIA Not Revising Gasoline Inventory Data
Stories in the petroleum trade press over the past week had suggested that the Energy Information Administration (EIA) was planning to publish revisions to its weekly motor gasoline inventory data that was published on March 2. As evidenced in today’s data release, that is not true. While EIA staff routinely reviews its data, no significant reporting errors at either the U.S. or regional level were found.
Data published in the Petroleum Supply Monthly typically provide improved accuracy over weekly reporting. Frequent users of petroleum supply statistics know there are times when the weekly published statistics do not follow the reporting pattern in the subsequent monthly data release for that period. Data in the Petroleum Supply Monthly are subject to further revision in the Petroleum Supply Annual. Details on survey methodology including editing, imputation, and revisions can be found in the Explanatory Notes sections of both the Weekly Petroleum Status Report and Petroleum Supply Monthly available on the EIA web site.
In Like A Lion
The rash of late winter storms that swept through the East Coast in recent weeks may have confirmed Punxsutawney Phil’s February 2 prediction for six more weeks of winter, but the recent pattern of snowy weather is not expected to outweigh the first five months of the 2004-05 winter heating season that saw moderately warmer-than-normal temperatures over much of the Nation. Monthly temperatures (weighted on an oil-home-heating customer basis) compiled from the National Oceanic and Atmospheric Administration (NOAA) from October through February, show that, so far, the winter heating season was slightly warmer-than-normal at the U.S. level, as well as in the Northeast, where much of the Nation’s oil is consumed.
Despite the relatively moderate winter weather, total distillate fuel oil (used for both heating oil and diesel fuel) consumption averaged nearly 4.2 million barrels per day during the first five months of the 2004-05 heating season (October through February), up over 2.4 percent over the same period last winter. The strong demand for distillate fuel this winter is largely due to the diesel fuel component, which has been particularly strong in recent months. The winter draw on total distillate fuel inventories through March 4, 2005, totaled nearly 14 million barrels, 3 million barrels or about 18 percent below the most recent 5-year average stockdraw for this period. However, a better gauge of the actual draw on heating oil inventories was the nearly 13 million barrels withdrawn in PAD District I (East Coast) during the October through February period. This level was only slightly above the 5-year average draw for this region (12 million barrels). Nevertheless, both national and East Coast total distillate fuel inventories remain close to the lower boundary of the average range for this time of year, reflecting a continuation of the low inventory pattern seen since the beginning of the heating season (see Figure 5. Weekly Petroleum Status Report). Given the current low level of distillate inventories, primary stockholders are likely to be confronted with the same low inventory pattern leading up to the start of the next build season, which typically occurs between April and September.
In contrast to distillate fuel oil inventories that began the 2004-05 winter heating season at the lower edge of the normal range, propane inventories were at the upper limit of the normal range during this same time, a level that provided a safety net if winter temperatures turned severe. While temperatures on the East Coast, where a majority of the nation’s heating oil customers are located, averaged less than 2 percent above normal during the first five months of the heating season, the Midwest, where most of the propane-consuming customers are located, recorded temperatures nearly 10 percent above normal. Nevertheless, during the first five months of the 2004-05 heating season, propane consumption averaged about 1.5 million barrels per day, about 1.0 percent above the same period last year. While the weather likely moderated heating-related demand, propane demand in other sectors was strong during this period, particularly for petrochemical feedstock use of propane.
The Midwest region reported an inventory decline that was more than 7 percent below the 5-year average. Overall, U.S. inventories of propane declined by 34.7 million barrels between October 2004 and February 2005, only 1.5 million barrels below the 5-year average stockdraw of 36.2 million barrels for this period. But with only one month remaining in the heating season, U.S. inventories of propane, at an estimated 32.5 million barrels as of March 4, 2005, are expected to finish the heating season at a level well within the average range. Accordingly, primary propane stockholders should have a slightly higher inventory base to rebuild from for the next heating season, compared with last year (see Figure 7. Weekly Petroleum Status Report). Whether March weather goes out like a lion or a lamb, attention will likely turn away from heating oil and propane inventories, and towards U.S. gasoline markets, which appear poised to enter the peak summer demand season with prices, in nominal terms, at historically high levels.
U.S. Average Retail Gasoline Price Jumps By 7 Cents
The U.S. average retail price for regular gasoline increased this week by 7.1 cents from the previous week to reach 199.9 cents per gallon as of March 7, 26.1 cents higher than this time last year. Prices were up across all regions, with the Midwest seeing the largest gain of 9.1 cents to reach 200.9 cents per gallon. The West Coast posted the highest regional price of 217.4 cents per gallon, up 5.1 cents from the previous week and 14.8 cents higher than last year. Prices in California gained 5.3 cents to 222.9 cents per gallon. Retail prices on the East Coast gained 6.3 cents to 195.2 cents per gallon, which is 24.7 cents higher than last year.
Retail diesel fuel prices gained 5.0 cents last week to 216.8 cents per gallon. Prices were up throughout the country, with the Gulf Coast seeing the largest regional increase of 6.5 cents to 210.0 cents per gallon. Prices on the West Coast gained 3.8 cents to average 245.0 cents per gallon, the highest regional average in the country, and 60.5 cents per gallon higher than last year. Average diesel fuel prices in California increased by 3.2 cents to reach 240.8 cents per gallon, which is 48.1 cents higher than this time last year. East Coast prices rose 4.6 cents to average 216.3 cents per gallon.
Residential Heating Oil Prices Increase Again While Propane Prices Turn Downward
Residential heating oil prices increased for the period ending March 7, 2005. The average residential heating oil price increased by 4.5 cents from last week to reach 208.8 cents per gallon, an increase of 48.7 cents from this time last year. Wholesale heating oil prices increased 4.2 cents to reach 156.1 cents per gallon, an increase of 54.4 cents compared to the same period last year.
The average residential propane price decreased 0.4 cent to reach 171.3 cents per gallon. This was an increase of 20.0 cents over the 151.3 cents per gallon average for this same time last year. Wholesale propane prices increased 2.7 cents per gallon, from 85.3 cents to 88.0 cents per gallon, a gain of 22.8 cents compared to the same period last year.
Propane Posts Modest Weekly Build
Despite a late winter storm on the East Coast last week, U.S. inventories of propane posted a relatively modest 0.9-million-barrel gain that moved inventories up to an estimated 32.5 million barrels as of March 4, 2005. Although weather may have been a factor for East Coast and Midwest inventory declines that measured 0.5 million barrels and 0.1 million barrels, respectively, the Gulf Coast more than offset these declines with a 1.6-million-barrel gain, most likely reflecting a carry over of the exceptionally large volume of imports into the region during the prior week. Whether last week’s inventory gain marks the end of the withdrawal season may be too early to surmise at this time, although March inventory trends tend to exhibit modest gains as well as losses. The combined Rocky Mountain/West Coast regions continued lower with a 0.1-million-barrel decline during this same period. Propylene non-fuel use inventories shot higher by 0.9 million barrels last week to 4.4 million barrels, accounting for a sharply higher 13.5 percent share of total propane/propylene inventories from the prior week’s 11.1 percent share.
Text from the previous editions of “This Week In Petroleum” is now accessible through a link at the top right-hand corner of this page.
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7.1
-0.4
