Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Gold/Mining/Energy : KERM'S KORNER -- Ignore unavailable to you. Want to Upgrade?

To: Kerm Yerman who wrote (13058)	10/28/1998 7:38:00 AM
From: Kerm Yerman	Read Replies (1) \| Respond to of 15196

REPORT / Crude overhang dampens mogas draw to new low 10/27 18:39 REUTER POLL FORECAST* ACTUAL FOR FOR WEEK ENDED 10/23/98 WEEK ENDED ------------------------------------------------------------ CRUDE............ UP 4.000 MLN 335.730 UP 7.867 MLN DISTILLATE....... UP 0.500 MLN 147.761 UP 0.637 MLN GASOLINE......... DN 1.000 MLN 197.258 DN 2.080 MLN UTILIZATION...... UP 1.50 (PCT PT) 88.5 PCT UP 1.7 PCT PT *NB - The forecast is derived by polling at least six market analysts/traders, omitting the high and low forecast and averaging. NEW YORK, Oct 27 - U.S. gasoline inventories have finally fallen below year-on-year levels but sentiment was still dampened by the overhang of a hefty build in crude stocks, traders and analysts said on Tuesday. "There is some sign that the picture for the products market is now changing, now that gasoline is below year-ago figures," said Thomas Blakeslee, a trader at Eildon Associates. "But with crude stocks so high, it is hard to get bullish," he added. The American Petroleum Institute (API) reported that gasoline stocks have fallen by over 2.0 million barrels in the week ended Oct. 23 to 197.3 million, a marginal 390,000 barrels lower than stocks reported for same time last year. Although the draw was linked mainly with the drop in refining production during the autumn turnarounds, analysts said implied gasoline demand was still strong at 8.5 million to 8.6 million barrels per day (bpd), despite the fact that the peak gasoline demand season of summer is over. "Gasoline production has come off, but demand is robust with the economical environment and the large appetite for four-wheel drives," Blakeslee said. The crude build of nearly 8.0 million barrels, however, was double what market watchers expected, despite factoring in a correction in the API's data to bring it more in line with the previous week's larger build reported by the U.S. Department of Energy (DOE). "There was certainly a bigger build in crude than expected, especially in PADDs 1, 2 and 5 of around two million barrels each. It was expected that it would have to catch up with the DOE's, but it has more than caught up," said trader and analyst Tom Bentz at Cresvale International. "What this means is, although the APIs are supportive on products, is that there are plenty of crude supplies -- over 29 million barrels higher than year-ago levels -- and these will have to make their way, become refined into products," Betnz added. Refiners were also coming out of turnarounds with throughputs rising 1.7 percent to 88.5 percent at a rate of 13.7 million bpd or churning out an additional 258,000 bpd of oil products. "Directionally, overall inventories will continue to decline into the fourth quarter, which is somewhat positive. Eventually, (crude) prices should move in a $13 to $16 (per barrel) trading range...but we have to wait to see how the winter turns out," said Nizam Sharief, an analyst with Houston-based Horsnby & Co. In after-hours ACCESS trading on the New York Mercantile Exchange, the December crude contract was trading at $14.05, down around eight cents per barrel from its close earlier Tuesday, while November gasoline was off 0.14 cent per gallon at 44.00 cents. November heating oil slipped 0.24 cents per gallon to 38.55 cents. "Nobody was expecting a very positive report...the focus is more on Hurricane Mitch, which has already shut in production in Mexico and could make its way into the Gulf," said Bentz.