By JOHN P. TRETBAR
Crude futures prices continue to rise, with the benchmark contract in New York topping $111 on Monday for the first time since March. London Brent was just over $112. The spread between US and London benchmarks dropped to just 49 cents, the smallest in recent memory.
Kansas crude prices gained four dollars on Friday to once again top $100 per barrel. Kansas Common crude at CHS in McPherson starts the week at $100.75 per barrel.
Kansas, is one of just three states with average pump prices below four dollars a gallon. The auto club Triple-A says Monday’s national average for a gallon of regular gas set another record at $4.48. That's 40 cents more than a month ago, and $1.43 more than a year ago. Most local retailers are offering regular under four dollars a gallon.
Baker Hughes reports 714 active drilling rigs across the US Friday, up six oil rigs and three drilling for natural gas. The count in Texas was up four rigs.
Independent Oil & Gas Service reports 21 active drilling rigs in eastern Kansas, which is up one from last week, and 29 in the western half of the state, which is unchanged. Drilling was underway Friday on leases in Barton and Stafford counties.
Kansas operators completed 20 wells last week, with 13 east of Wichita and seven in Western Kansas, including one well in Stafford County. That's 582 new well-completions so far this year compared to 265 at this time last year
Kansas regulators approved 47 permits for drilling at new locations during the week through May 12th. There are ten new permits in the eastern half of the state and 37 west of Wichita, including three in Barton County and one in Russell County.
Last week for the first time the war in Ukraine has Russian natural gas flows to Europe. Reuters reports Ukraine shut down its natural gas transit point, because of interference by occupying forces. That dropped Russian gas deliveries to Europe by 25%. Prices on the energy markets reversed course on the news.
The government reports US crude inventories increased by more than eight million barrels to 424.2 million barrels on May 6th. The Energy Information Administration reports US stockpiles are about 13 percent below the five-year average for this time of year. Gasoline stockpiles were down more than three million barrels and are about 5% below the five year seasonal average.
Crude production in the US was down slightly from the week before but remains nearly a million barrels a day higher than a year ago. The EIA reported US output of 11.847 million barrels per day for the week through May 6th.
US imports were down 62,000 barrels per day to 6.3 million. The four-week average is more than six percent higher than imports for the same four weeks a year ago.
Oil by rail traffic last week increased slightly over the week before, but remains more than eleven percent below the tally last year at this time. The Association of American Railroads reports 8,940 tanker carloads hauling petroleum and or petroleum products during the week through May 7th. That's up 116 carloads from the week before. Canadian oil-by-rail traffic dropped by more than 700 tanker carloads, but remains about ten percent above the total a year ago.
The world's largest crude-oil exporter is enjoying a giant leap in profits. Saudi Aramco said it's net income rose 84% in the first quarter to $39.5 BILLION, owing largely to the 45% increase in prices since the start of the year.
A Senate committee has approved a bill allowing anti-trust lawsuits against OPEC and its members for market manipulation. The No Oil Producing and Exporting Cartels Act, or NOPEC, has been on and off the table for decades, but never advanced past committee discussion. The measure passed 17-4 in the Senate Judiciary Committee earlier this month. The move is opposed by almost everyone in the industry, from OPEC to the American Petroleum Institute and the US Chamber of Commerce.