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WTI prices see a glimmer of hope at Cushing (Part 6 of 11) (Continued from Part 5) Cushing inventories
Cushing, Oklahoma, is the delivery point for NYMEX crude futures contracts. It’s where a lot of crude supply sources meet a lot of the crude demand sources. So, monitoring inventory levels at Cushing is a very important part of understanding what’s going to happen to WTI (West Texas Intermediate) prices.
Crude stocks at Cushing have continuously been rising since October 2014, when stocks were close to ~19 million barrels.
Until last week, inventories have increased on average by 2.23 MMbbls since the beginning of this year. Breaking the trend in the week ended February 27, inventories increased by just 540,000 barrels to 49.2 million barrels.
These levels are just ~2.6 MMbbls short of the record high inventory levels of ~52 MMbbls in January 2013.
To put things further into perspective, consider that according to the EIA, Cushing has about 71 million barrels of crude storage. The current storage is about 69% of the total storage capacity, as per the EIA. Coupled with the fact that inventories have been continuously rising for the past four months, this finding makes it more likely that Cushing will soon approach its full capacity. Although the build seems to have slowed down, it’s probable that Cushing will soon reach its full capacity—as long as US production surge.
If the oil hub reaches its full storage, oil prices could tumble further.
Increasing inventories pull prices lower, which in turn hurt the margins of companies such as Chevron (CVX), Whiting Petroleum (WLL), Concho Resources (CXO), and ExxonMobil (XOM). All these companies are components of the SPDR S&P Oil & Gas Exploration & Production ETF (XOP), and they make up ~5% of the ETF.
Continue to Part 7 Browse this series on Market Realist:
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Whiting Petroleum Corporation
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CODE : WLL |
ISIN : US9663871021 |
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ProfilIndicateurs de MarchéVALEUR : Projets & res.Communiqués de PresseRapport annuelRISQUE : Profile actifsContactez la cie |
Whiting Petroleum est une société de production minière de pétrole basée aux Etats-Unis D'Amerique. Whiting Petroleum est cotée aux Etats-Unis D'Amerique et en Allemagne. Sa capitalisation boursière aujourd'hui est 6,2 milliards US$ (6,1 milliards €). La valeur de son action a atteint son plus haut niveau récent le 22 août 2008 à 99,26 US$, et son plus bas niveau récent le 03 avril 2020 à 0,25 US$. Whiting Petroleum possède 90 927 193 actions en circulation. |