The American Petroleum Institute’s Monthly Statistical Report showed that the US oil production, demand, and trade activities were remarkably strong in August despite weaker key economic indicators.
August US petroleum demand hit the monthly highest since August 2005 at 21.5 million bpd. The number was up by 3.2% month-on-month and 0.9% year-on-year. Year-to-date, total petroleum demand was the strongest since 2007 at 20.5 million bpd.
Gasoline demand increased by 1.7% month-on-month and 0.1% year-on-year to 9.8 million bpd. Year-to-date, gasoline demand dropped by 0.4% year-on-year.
Distillate demand rose by 1.1% month-on-month but dropped by 5.8% year-on-year. Year-to-date, demand fell by 1.2% year-on-year.
The US produced 12.3 million bpd of crude oil in August and maintained the natural gas liquids production of 4.8 million bpd for the fifth month in a row. Production remained soled despite more than a 4% drop in drilling activity in the month.
According to Baker Hughes, oil-targeted rigs in august was 760 units, down from 782 in July. The reading was in line with continued shale productivity increases shown in the US Energy Information Administration (EIA) Drilling Productivity Report, along with the decline in the count of drilled but uncompleted wells (DUC) in July at 8,108 units.
Meanwhile, for trade, petroleum exports showed a rebound in August at 8.1 million bpd, up by more than 400,000 in July, and more than 1 million bpd increase from August last year. Petroleum imports increased for both crude oil and refined products. Net imports rose to 1.9 million bpd, up by 100,000 bpd month-on-month but dropped by 1.5 million bpd year-on-year.
The country’s gross inputs to refineries were 17.9 million bpd, implying a capacity utilization rate of 95.2%, both figures are the highest this year. Total petroleum inventories were 1.31 billion barrels, excluding the Strategic Petroleum Reserve. Refined product stocks increased and crude oil stocks dropped due to increasing crude exports.
However, key economic indicators underlined weaker industrial activity and consumer sentiment. API’s Distillate Economic Indicator was at -0.1 in August and the 3-month average reading was also at -0.1, showing how the country’s industrial production was slowing.
The Institute for Supply Management’s Purchasing Managers Index showed a contraction in industrial activity with 49.1 reading in August. New orders, production, and employment all decreased, while supplier deliveries slowed and indicators covering trade, supplier backlogs, inventories, and raw materials were all weakened.
According to the US Bureau of Labor Statistics, labor markets remained close to record-low unemployment. The unemployment rate was still steady at 3.7% as US nonfarm payrolls increased by 130,000 in August.
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