The world is going through a crazy time of futile and stupid gestures.
Environmentalists have gone full Animal House in winning a futile and stupid gesture by finally killing for good the Keystone XL Pipeline. They celebrated the news that Canada’s TC Energy Corp (NYSE:TRP) finally gave up and is walking away from the Keystone XL oil pipeline project.
All the while these so called environmentalists are wearing their petroleum-based outdoor clothing and shoes and use their petroleum-based gear as they add to greenhouse gas emissions, not reduce it.
You see when their questionable science becomes religion, sometimes common sense must be forgotten and the facts ignored. Like the fact that after numerous studies show that killing a petroleum transport pipeline has no measurable impact on greenhouse gas emissions, we’ll see more carbon emitted as oil and gas will now be transported by truck and rail.
Or the futile and stupid talks with Iran as the U.S. State Department says they are deeply concerned that Iran has yet to provide IAEA with information; the agency needs to resolve questions regarding potential undeclared nuclear material. The crude oil market is starting to understand that a deal with Iran is getting less likely.
Not only is our Secretary of State, Anthony Blinken, saying he doubts that Iran will comply, but the terror sponsor regime is also now sending warships to our hemisphere. The U.S. is warning Iran that we will not tolerate weapons transfers. Iran seems to be ignoring a lot of warnings lately.
The Tasnim news service says that, “An Iranian Navy flotilla that includes a new sea base-like ship and a destroyer has entered the Atlantic Ocean, a senior commander said. Deputy Chief of the Iranian Army for Coordination, Rear Admiral Habibollah Sayyari, told reporters on Thursday that the Makran forward base ship and Sahand Destroyer have arrived in the Atlantic Ocean for the first time without any port calls in other countries. He added that it shows the power and robustness of the Islamic Republic of Iran.
Last week, the two vessels were reported to have rounded the Cape of Good Hope, heading toward the Atlantic Ocean. In recent years, Iran’s naval forces have increased their presence in international waters to secure naval routes and protect merchant vessels and oil tankers against pirates. In comments in October, Navy Commander, Rear Admiral Hossein Khanzadi, said Iran’s first homegrown auxiliary ship is capable of sailing around the globe three times without being refueled.
There is concern that Iran is going to establish a military presence in Venezuela to be more of a threat to the U.S. homeland.
Oil prices pulled back a bit after the Energy Information Administration report seemed to raise concerns about U.S. gas demand. U.S. gasoline stockpiles have jumped 7 million barrels, the highest in three months, while the EIA “Implied Demand” fell to a three-month low Wednesday.
Yet looking at U.S. weekly gas demand data in the aftermath of the Colonial Pipeline is futile and stupid because the data is off. First, everyone filled their tanks early. Next, we saw a flood of imports from Europe, and the waiver of the Jones Act had supplies moving in places where they do not normally move. Total motor gasoline imports (including both finished gasoline and gasoline blending components) last week averaged 1.1 million barrels per day.
Energy Expert Robert Gibbons points out that last week’s demand drop was after several weeks of gasoline moved into secondary and tertiary tanks, first because of Colonial, then ahead of Memorial Day. Colonial-induced tank topping slowing or stopped wasn’t unexpected.
So the next few weeks should be more informative. Also, if you look at the 4 week average it is more telling. Over the past four weeks, motor gasoline product supplied averaged 9.1 million barrels a day, up by 23.2% from the same period last year. The EIA reported that crude supply fell by 5.241 million barrels as refiners ramped up and distillates by 4.412 million barrels.
The most bullish aspect of crude was the refining. They’re back! The EIA says that U.S. crude oil refinery inputs averaged 15.9 million barrels per day during the week ending June 4, 2021, which was 327,000 barrels per day more than the previous week’s average.
Refineries operated at 91.3% of their operable capacity last week. Gasoline production decreased last week, averaging 9.4 million barrels per day. Distillate fuel production increased last week, averaging 4.9 million barrels per day. U.S. crude oil imports averaged 6.6 million barrels per day last week, increased by 1.0 million barrels per day from the previous week. Over the past four weeks, crude oil imports averaged about 6.2 million barrels per day, 1.9% less than the same four-week period last year.