The En-Pro Blog

The highly anticipated OPEC meeting has come and gone and with it, the big question, post-meeting, “What did we meet about again?” They really had no choice but to leave production at current levels. Any further cuts would have flushed, what hope of economic recovery is left, down the proverbial toilet.

Their current cuts still seem to be gaining momentum with another 571,000 bpd decrease of crude imports into the U.S. compared to last year as reported for the week ending March 13, 2009. Despite the decrease in crude imports and the refining sector lowering their runs by 0.6% to an extremely low capacity of 82.1% (approximately 5% below the norm for this time of year), inventories of crude, gasoline and distillates increased.

To further confound our friends at OPEC, the inventory levels of crude and distillates are basically overflowing while gasoline levels are now in the upper half of the five year average for this time of year.

Many more questions remain, like, where’s the comfort zone here in terms of crude oil prices? What about the inventory tanks, diesel racks, distillates, and where will the price of oil per barrel go? And the biggest question of them all, when the heck will we see some recovery after the Federal Reserve’s token one trillion dollar injection?

By: Roger McKnight, Senior Petroleum Advisor

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