By JOHN P. TRETBAR
Eagle Media
Kansas crude prices post mixed messages, up two dollars on the week, but still hovering near five-year lows. Kansas crude prices spiked on Friday to post a two-dollar weekly gain. Kansas Common starts the week at $49.25 per barrel. Prices at CHS in McPherson dipped to five-year lows below $50, and stayed there, beginning in mid-November. Crude futures prices in New York also posted two percent gains Friday.
Year-end analysis by The Energy Information Administration shows global prices dropping from a monthly average of $79 per barrel in January to a low of $63 per barrel in December. That's the lowest monthly average for Brent crude since early 2021. The annual average last year was just $69 a barrel, which is the lowest since 2020. EIA estimates global production outpaced consumption all year, prompting one of the biggest inventory build-ups in 25 years.
Operators in Kansas drilled 781 wells to total depth last year, down 587 wells or 43% from the year before. Independent Oil and Gas Service reported Overall oilfield activity dropped 37%, and the number of active operators to drill a well was 189, down from 258 the year before. Operators here completed 18 wells this week including one wildcat well, and one service well in Ellis County.
The Kansas Rig Count from Independent Oil and Gas Service lists 14 active drilling rigs. Seven are east of Wichita, which is up two, and seven are in Western Kansas, which is down two. The statewide tally is down more than six percent from last month, and 22 percent lower than a year ago. Drilling was underway or about to begin on a lease in Russell County.
At 544 active rigs, the weekly Rotary Rig Count from Baker Hughes drops by three oil rigs and one gas rig. Louisiana is down three rigs for the week; Utah is up four. Wyoming is down one; Colorado is up one. Texas, New Mexico and North Dakota each drop by one rig.
Over the long haul, the top three producers are reporting production increases despite declining rig counts. Texas is down 52 rigs from a year ago. North Dakota is down by ten rigs from the same week last year. New Mexico is down just three rigs, year-over-year. A few states are posting year-over-year increases. Louisiana is up ten rigs from a year ago. Utah is up six rigs. Ohio posts an increase of five rigs over last year.
US crude-oil production drops slightly this week but remains over 13.8 million. Production is a quarter million daily barrels higher than the same week last year. The Energy Information Administration reports the four-week average is also over 13.8 million barrels per day.
Commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) decreased by 3.8 million barrels from the previous week. At 419.1 million barrels, U.S. crude oil inventories are about 3% below the five year average for this time of year.
The government adds another 200,000 barrels to the Strategic Petroleum Reserves, which now total more than 413 million barrels. That's an increase of nearly 20 million barrels or five percent in the last year.
Crude imports are up nearly 1.5 million barrels per day from last week at just under 6.4 million barrels a day. The four week average is down about ten percent from a year ago. Crude exports are up nearly a million barrels a day. Refined product exports beat last week by half a million barrels a day. Product exports surpass the tally a year ago by 1.4 million, and beat the year before that by two million barrels a day.