News from the Oil Patch, March 25
By John P. Tretbar
The near-month NYMEX futures contract for light sweet crude closed 75 cents higher on Tuesday, to rise above $83 a barrel for the first time since October 30. Then traders retreated, and that contract settled at $80.63 on Friday, posting a weekly loss of $0.41 a barrel. Prices rose a more than a dollar on Monday. WTI was trading over $82 by midday, and London Brent was over $86 per barrel. U.S. crude has traded within a price range of less than three dollars a barrel since the first of March.
Kansas Common crude at C.H.S. in McPherson starts the week at $71 a barrel after dropping 25 cents on Friday. That price is up 75 cents from the first of the month and nine dollars higher than at the first of the year.
According to new research of government data, so-called proved crude oil reserves in Kansas dropped more than 18 percent in the five years through 2021, even as U.S. proved reserves rose more than 25 percent. That's according to Construction Coverage, a Web site specializing in construction and insurance. According to the report, Kansas boasts the 12th largest reserves in the country at 292 million barrels. Proved reserves are those deposits that are recoverable under current economic and operating conditions. The U.S. has over 41 billion barrels in proved reserves. U.S. commercial crude-oil inventories dropped by two million barrels last week to 445 million. That's about three percent below the five-year seasonal average. By this time last year, crude-oil stockpiles were nearly 40-million barrels higher at over 481 million. Two years ago, that number was more than 30 million barrels lower at 413 million.
U.S. crude production last week was slightly higher than the week before at 13,141,000 barrels per day. That's an increase of 9,000 barrels per day, and 800,000 barrels per day higher than a year ago. Over the last four weeks, production averaged about 13.2 million barrels per day. That's up nearly eight percent from the four-week average of 12.2 million barrels a day last year at this time.
U.S. crude-oil exports last week totaled 4,881,000 barrels per day, according to a government report. That's an increase of 1.7 million barrels from the week before but down about 50,000 barrels a day from a year ago. Over the last four week, exports averaged 4.3 million barrels per day, down half a million barrels from the four-week average a year ago.
E.I.A. said U.S. crude oil imports averaged 6.3 million barrels per day, marking an increase of 787 thousand barrels per day from the previous week. Over the past four weeks, crude oil imports averaged about 6.3 million barrels per day, two percent higher than the same four weeks last year.
The Rotary Rig Count from Baker Hughes dropped to 624, down one oil rig and four gas rigs from a week ago. The count in Louisiana was down four. New Mexico was down one. The Kansas Rig Count from Independent Oil and Gas Service is unchanged for the week, up 38% from a month ago, and down 26% from a year ago. Drilling was underway or about to start on Friday on a lease in Barton County and another in Ellis County.
Regulators approved 20 new drilling permits across the state, with all but two of them in eastern Kansas. That's 193 new drilling locations statewide so far this year, compared to 296 by in late March late year. Operators across Kansas completed 30 wells last week, with 14 West of Wichita including one in Ellis County and another in Russell County. Independent Oil and Gas Service reports 259 new well-completions so far this year, compared to 471 by this time a year ago.
The Kansas Geological Society met last week to recognize and name four new oil fields in Kansas. Those new fields are located in Butler, Hodgeman, Rawlins and Thomas counties.
Output in the number-three crude-producing state was down more than 13% in January, due largely to a winter weather event that shut in nearly half of the state's production. The Department of Mineral Resources last week reported final production totals for January dropped by more than 172-thousand barrels per day, to just over 1.1 million barrels per day. Natural Gas production was down 15%, and the gas-capture rate at oil wells dropped from 95 to 93 percent.