Navarik Market Update
June 22, 2017
After weeks of conflicting signals, bearish sentiment returned full force to the oil market. On the surface, this week’s EIA release seems to refute that assessment, with a major drop in crude stocks overpowering a minor jump in domestic production. Furthermore, weeks of lower-than-expected demand data had re-enforced expectations that price increases would have to come from lower supply (hence the continued OPEC-Shale debate), but strong refinery utilization rates have turned that theory on its head.
With throughput finally hitting seasonal peaks, it appears we could be on-trend to draw down the oil glut without the expected supply drop, but this requires end demand to remain strong enough going forward to prevent the glut from simply being transferred downstream. Navarik data can provide unique foresight on this question before the market; our forecasted clean product exports out of PADD 3 for weeks 25 and 26 are up 211% year-over-year, versus a year-to-date rise of 108%.
While this might seem reassuring to bulls, it still puts the focus back on production. As always, the spotlight has immediately shifted to next week’s data. Navarik will be there to provide market-leading guidance then as well.
Colin McCann is an Oil & Gas analyst with Navarik Corporation. The Navarik Data Products team analyzes Navarik's proprietary data sets and external sources to provide insights into the oil & gas shipping market. The resulting analysis enables physical and paper traders to see ship movements across the barrel before anyone else in the market.
A list of current available trade flow reports can be found here.