Last updateThu, 18 Jul 2019 4pm


U.S. On Track to Become Net Energy Exporter

U.S. crude oil exports reached a new all-time high of 3.3 million barrels per day (b/d) in June 2019, a 1.1 million b/d year-over-year increase, according to the latest Monthly Statistical Report released by the American Petroleum Institute (API). This latest milestone came as the U.S. continued to sustain world-leading crude oil production of 12.2 million b/d, including 5.0 million b/d in West Texas’ Permian Basin. Increasing U.S. crude oil exports are a net positive for American consumers who have benefited from significant declines in energy expenditures since the rise of the shale revolution.

2019 Global Oil Demand Revised Down

In its July 2019 edition of the Short-Term Energy Outlook, the U.S. Energy Information Administration (EIA) forecasts that global liquid fuels consumption, which averaged 99.9 million barrels/day (b/d) in 2018, will grow by 1.1 million b/d in 2019 and by 1.4 million b/d in 2020. EIA has revised down its expectation for global liquids demand growth for six consecutive months. This revision reflects slower expected economic growth in many of the world’s largest oil-consuming countries, lower than expected oil consumption so far this year, and higher crude oil prices. One of the main drivers of EIA’s global oil consumption forecast is global gross domestic product (GDP) based on country-level forecasts from Oxford Economics.

ExxonMobil, SABIC Proceeding with TX Petrochemical Project

ExxonMobil and SABIC are proceeding with the construction of a chemical facility and a 1.8 million metric ton ethane steam cracker in San Patricio County, TX. Economic output is expected to exceed $22 billion during construction and $50 billion during first six years.

The joint venture between ExxonMobil and SABIC, called Gulf Coast Growth Ventures, received final environmental regulatory approval in June 2019. Construction will begin in the third quarter of 2019 and startup is anticipated by 2022.

‘Biggest Change in Oil Market History’ Less Than Six Months Away

“On January 1, 2020, the International Maritime Organization (IMO) will enforce new emissions standards designed to significantly curb pollution produced by the world’s ships,” CNBC reports.

“It is the biggest change in oil market history,” according to Steve Sawyer, senior analyst at energy consultant Facts Global Energy. “It is going to affect crude oil producers, traders, ship owners, refiners, equity investors, insurance companies, logistical businesses, banks… Who’s left? I’m struggling to think of anyone it might not affect. That’s why it is a huge transition.”

Chemical Activity Barometer Flat in June

The Chemical Activity Barometer (CAB) from the American Chemistry Council was flat (0.0% change) in June on a three-month moving average (3MMA) basis, following three monthly gains. On a year-over-year basis, the barometer is up 0.3% (3MMA). The unadjusted measure of the CAB retreated 0.2% in June and fell 0.3% in May. The diffusion index rose to 65% in June.

The diffusion index marks the number of positive contributors relative to the total number of indicators monitored. The CAB reading for May was revised downward by 0.38 points and that for April by 0.22 points. Production-related indicators in June were slightly positive.

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