By JOHN P. TRETBAR
Eagle Media
Crude prices rebound Tuesday, after dropping two percent on Monday.
Monday's settlement price for NYMEX crude was pennies above $63 a barrel. On Tuesday, the expiring May NYMEX contract was fetching offers just under $64, while the June contract was nearly a dollar cheaper. London Brent was fetching a few cents over $67 a barrel by midday.
Kansas crude prices start the week lower than they started the month. Prices in the Sunflower State jumped more than two dollars last Thursday, only to drop $1.75 after the holiday break.
Kansas Common crude at CHS in McPherson is priced Monday at $53.25 per barrel. That's up $1.50 from last week, but down eight dollars from the first of the month, and nearly nine dollars lower than at the first of the year.
Producers continue to get more bang for the buck. The weekly Rig Count from Baker Hughes posted the first increase in the closely-watched industry barometer in four weeks, at 585 active rigs, marking an increase of one oil rig and one gas rig. But, despite record production, the average rig count so far this year drops to 587 rigs, down 13 rigs from the average for all of last year.
The weekly Kansas Rig Count from Independent Oil and Gas Service is unchanged in western Kansas, but up two rigs east of Wichita. This week's total of 24 active drilling rigs is up nine percent from a week ago, up 33 percent from a month ago, but down 22 percent from a year ago. Drilling was underway Friday on two leases in Finney County.
Regulators okayed eight new drilling permits in western Kansas out of 12 statewide last week, with one of those in Ellis County. That's 221 new drilling locations so far this year, compared to 256 a year ago at this time.
Independent Oil and Gas Service reports 24 newly completed wells, 389 so far this year, which is up 35 wells from a year ago. There are twenty wells on the list in eastern Kansas and four west of Wichita.
The U.S. is still a net crude oil importer, but the balance is getting closer. Average crude exports last week topped five million barrels per day, something that has only happened ten times before. The Energy Information Administration reports exports jumped nearly two million barrels a day from a week earlier to 5.1 million barrels a day. That's the highest tally in a year.
Domestic crude imports dropped nearly 200,000 barrels to six million barrels a day. Imports outpace exports by just 900,000 barrels a day, the smallest net-import ratio in recent memory.
Commercial crude inventories rose half a million barrels to nearly 443 million. That's about six percent below the five-year average.
The Energy Department continues to reap a paper profit refilling the Strategic Petroleum Reserves, adding 300,000 barrels last week to top off the SPR at 397 million barrels, up 33 million from a year ago.
EIA reports domestic crude-oil production rose slightly from a week ago, to just under 13.5 million barrels a day. The four-week average is also above 13.5 million but cumulative output so far this year is just under that mark.
The Energy Information Administration is bracing for the administration’s latest round of resignation offers, putting at risk some of the most closely watched energy reports anywhere. The agency publishes weekly, monthly and annual data on the oil and gas industry. Reuters cites five unnamed sources with estimates up to one-third of the workforce leaving.
The Keystone Pipeline restarted just a week after a rupture and spill in North Dakota shut down the facility. South Bow, the spin-off company now in charge of the pipeline, announced last week it had completed all repairs, inspections and testing. The company says the government has approved its repair and restart plans.
They will operate at reduced pressure as assessments continue, based on government corrective orders. Work on recovering the spilled crude are ongoing, and site remediation efforts continue at the farm field near Fort Ransom, North Dakota.
The cause of the spill has not been announced. On the morning of April 8, an employee reported the spill after hearing what was described as "mechanical bang." Officials say 3,500 barrels spilled.