evening wrap

market vibes

January 2, 2025 … 4:18 PM)

“Waste no more time arguing about what a good man should be. Be one.”
Marcus Aurelius, circa 165 AD

The department of Energy reported gasoline inventories continued to build seasonal supply on schedule, rising by an unusually large 7.7 million barrels last week. Distillate inventories rose by 6.4 million barrels from an already ample supply.

Distillates stocks usually increase in December and then decline from March into June. The US is the largest exporter of refined products so we’ll have plenty of wood to chop.

Total US crude inventories fell 1.17 mm barrels. To give you a sense of where supplies are, the blue line is days of supply (stocks to use). Ware still working of the covid surge especially since demand hasn’t changed in 20 years

Demand for all products, is: ((Refinery Output)+(Imports−Exports +/- stock changes)). Demand fell sharply at year end by 3.286 mm bpd. The measure did exactly the same last December, ostensibly due to taxes.

Bottom line: The U.S. oil industry is managing its business as well as can be expected with an oversupply of output and an unfriendly crude price in backwardation. XOM, a bellwether for majors, fell 14% in December.

The rest of the board? Hardly inspiring, but fear not! There are 251 more days to make some money. Let’s take a look and try to find something worth doing.