John P. Tretbar
CHS in McPherson raised it's prices a dollar and a half on
Friday. Kansas Common crude starts the week at $42.50 per barrel, the best
price since February 19, 2020.
After a long stretch of steady prices, we're now seeing a big bump at gas pumps across the country, and an even bigger bump locally. The statewide and national averages were up about three cents a gallon on the week, but local prices rose more than a dime in that same period. The statewide average in Kansas was $2.04 while the national average was just shy of $2.29 a gallon. Motorists in Hays and Great Bend were paying around $2.15 a gallon. There are just four states (Texas, Louisiana, Mississippi, and Missouri) boasting average gasoline prices under two dollars a gallon.
Baker Hughes reports its year-end rig count was less than half the total at the end of 2019. The weekly count on Friday jumped eight oil rigs and one gas rig for a total of 360 active rigs. New Mexico added four rigs and Oklahoma added one. Canada was up 58 to 117 rigs.
Independent Oil & Gas Service reports a 32% drop in its weekly Rig Count in Kansas, all in the eastern half of the state. The count east of Wichita went from ten last week to just three this week. In Western Kansas, the tally rose by one to ten active drilling rigs. The active rig count statewide at the end of 2020 was down 17% from the year-end total in 2019.
Regulators in Kansas approved eight new drilling permits across the state during the week ending January 7th. Four of them are in eastern Kansas and four are west of Wichita, including one new permit in Russell County. The state saw 482 permits last year, less than half of the total in 2019.
Independent Oil & Gas Service reports six new well completions in the first of its weekly reports this year. Five of those were in western Kansas, including one dry hole in Barton County. Kansas ended the year 2019 with 785 newly-completed wells, compared to nearly twice that number the year before.
Weekly crude inventories dropped eight million barrels. The Energy Information Administration Administration says stockpiles remain about nine percent above the five-year average for this time of year.
EIA reports U.S. crude production rose two thousand barrels per day during the final week of the year, to remain slightly above eleven million barrels per day for the sixth week in a row. Production a year ago was approaching 13 million barrels per day.
U.S. crude oil imports rose by 43-thousand barrels per day. The four-week average remains 18% below the same four-week period a year ago.
The government's final weekly crude-storage analysis of the year shows the Cushing tank farm at 74% of capacity for the fourth week in a row. Storage usage reached a peak May 1st as prices crashed.
Weekly oil-by-rail traffic was up slightly week over week, but still down more than 21% from a year ago. The Association of American Railroads reports 10,266 rail cars hauling petroleum or petroleum products for the week ending January 2nd. The trade group reports December's monthly total for oil-by-rail dropped by more than 10-thousand carloads from a year ago, a decline of nearly 16 percent amid a decline of nearly four percent in all rail traffic.
The world's largest international shipping association last week warned shippers to be on guard after Iran seized a South-Korea flagged tanker in the Strait of Hormuz. Iran took the vessel over alleged "oil pollution." South Korea has frozen seven billion dollars in Iranian oil funds held in a pair of Korean banks. Iran is demanding release of the money.
Lawmakers in North Dakota have gotten used to huge new budgets as the state rose to become the second-biggest oil-producer in the country. Up until last year they hadn't needed to issue bonds to pay for large capital projects. But now, thanks to plunging revenues brought on by the coronavirus pandemic, they are moving ahead with infrastructure projects worth over two billion dollars, funded by bonds to be paid for with future oil-and-gas taxes.