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“That’s going to be a big reduction” of supply, Genscape analyst Carl Evans said by instant message Monday. He said that up to 130,000 barrels a day of synthetic output is offline because of the Syncrude shutdown.
However, energy monitoring service Genscape still considers the train in the "pre-commercial" phase, as the capacity holders have 180 days before they need to begin the terms of their 20-year free on board (FOB) contracts. The offtakers of the 4.5 million-tonnes-per-annum train are Korea's Kogas with 3.5mtpa, and Shell with the remaining 0.7mtpa.
The softer increases at AECO come as forecaster Weather.com shows temperatures in Alberta have risen to the low 50s, tempering demand in the region. But upcoming maintenance on Alberta’s oilsands upgraders in April and May also appear to be pressuring gas prices as up to 230 MMcf/d of gas demand in the province could be cut, according to data and analytics company Genscape Inc.
Genscape’s latest Canadian Crude Oil Production Forecast Report is forecasting crude production will drop by as much as 260,000 b/d in April and May. Turnarounds at Suncor, Syncrude and Shell’s Scotford upgraders will reduce output in April and May by a total of 150,000 b/d. These turnarounds alone would account for a drop in gas demand of approximately 113 MMcf/d, the company said.
One particular concern is the near-record-high storage levels at the delivery point for the benchmark U.S. West Texas Intermediate oil contract, brokers said. Stockpiles there, at Cushing, Okla., rose by about 672,000 barrels in the week ended Tuesday, data provider Genscape Inc. said Thursday morning, according to a person who saw the report.
Industry monitor Genscape is tracking 390,000 tonnes of gasoline or reformate, which is used to create summer-quality fuel, in vessels including the Amorea, the Hamburg Star, the Hafnia Europe and the Clio circling outside European ports.
Some private companies such as Genscape and Prima Markets leverage government data for reference or comparison, but they also have their own proprietary collection methods unique to them, thus providing even more inconsistencies for those on the outside looking in. EIA biodiesel imports for 2016 come in at nearly 693 million gallons, whereas both Genscape’s and Prima Markets’ tallies are roughly 720 and 725 million gallons, respectively. For renewable diesel, EIA figures show nearly 223 million gallons entered the U.S. in 2016, while Genscape tracks the volume at about 206.5 million gallons and Prima Markets at almost 200 million.
“Many people would agree that EMTS data doesn’t accurately reflect what enters the U.S.,” says Will Martin, an analyst with Genscape Inc. For instance, EMTS data show approximately 166 million D6 RINs generated for renewable diesel in 2016, yet Genscape’s own data demonstrate that just 21 million gallons, or 10 percent, of renewable diesel imports in 2016 generated D6 RINs.
A new record high for US crude inventories… (note that Crude storage in ARA rises 7.3%, Genscape weekly data show, so European inventories are also soaring)
The proposed U.S. border adjustment tax plan, if passed, would hurt Canadian heavy crude exporters and create a “rampant increase” in the tax burden of receiving U.S. Midwest refiners, says a new report by Genscape.
While these refiners are largely dependent on Canadian heavy oil imports and have virtually no refined products export potential and will be most adversely affected by a border tax, refiners in the Gulf Coast will be among the “winners,” Genscape says.
Refineries would be strongly affected by Congress’s proposed border tax adjustment, however effects would vary by region according to a white paper released by Genscape. In general, refineries that are able to are likely to decrease imports in favor of domestic crude oil.