By JOHN P. TRETBAR
Crude prices have dropped nearly $9 in nine trading days. The near-month Nymex contract for light sweet crude settled Friday at $73.39 per barrel, down from nearly $82 on January 24th.
Kansas prices have dropped nearly $6 in the last week. Kansas Common crude at CHS in McPherson starts the week at $63.75 per barrel after dropping $2.50 on Friday. The average price in January was $68.72 per barrel. That's up nearly $2 from the month before, but down more than $4 from the January average last year.
Gasoline and diesel prices continued to drift lower last week, alongside gradual increases in US stockpiles. The national average pump price for a gallon of regular dropped to a fraction below $3.50 per gallon on Thursday. That's 28 cents more than a month ago, but about a dime cheaper than last year at this time. National diesel prices were also slightly lower at $4.67 per gallon, but remain nearly a dollar higher than a year ago. Across Kansas, the average price for regular was $3.20 per gallon Thursday; diesel was about $4.15 per gallon.
The government reported a slight uptick in weekly US crude production. The Energy Information Administration said operators pumped 12.151 million barrels per day in the week through January 27, up 1,000 barrels a day from the week before, and more than a half-million barrels per day higher than a year ago. EIA said imports increased by 1.4 million barrels per day. The four week average is one percent higher than imports during the same four weeks a year ago. Crude inventories were up 4.1 million barrels from the week before, and about four percent above the five-year average for this time of year.
New monthly numbers from the government show crude production inching upward in Kansas and a slight dip nationally. The November tally from the Energy Information Administration shows US operators pumped over 371 million barrels, or about 12.37 million barrels per day. Output the month before was about 3,000 d barrels per day higher. In Kansas, November output averaged 77,300 barrels per day, up about 100 barrels per day from October.
State regulators report 129 intent-to-drill notices filed across Kansas last month, up from 70 in December, and 97 in January of last year. There are three new intents in Barton County, six in Ellis County, two in Russell County and six in Stafford County.
The Kansas Rig Count was down seven rigs east of Wichita and down three rigs in Western Kansas, a 21% drop. Independent Oil & Gas Service reports a number of rigs in eastern Kansas have been cold stacked and taken out of service. The count is down nearly 25% from a month ago and is nearly 12% lower than a year ago. Drilling was underway Friday on three leases in Barton County, one in Ellis County and two in Stafford County. Operators completed 41 wells last week, 29 in Western Kansas, including one each in Barton and Ellis counties. Kansas regulators last week okayed 13 new drilling permits, eight of them west of Wichita, including two in Stafford County.
The Rotary Rig Count from Baker Hughes drops to 759, down ten oil rigs and two gas rigs. The counts in Texas and Wyoming were each down three rigs.
US rail shippers moved more crushed stone and sand last month than they ever have, thanks largely to the growth in demand for fracking sand. But the Association of American Railroads says total rail traffic in January was down more than three percent compared to a year ago. Oil-by-rail traffic during the week through January 28th was up more than 13% over the same week last year. AAR reports 10,952 tanker carloads hauling petroleum, up 366 carloads from the week before. Canadian traffic was down 138 carloads for the week, or about three percent below the tally a year ago.
An appeals court is forcing the government to consider a much broader class of pollutants before approving oil-and-gas drilling in northwestern New Mexico. The US 10th Circuit Court of Appeals invalidated the government's analysis of the impact of drilling, in what environmental groups say is a "new precedent" that will help protect community health. The court rejected nearly 200 drilling applications in the greater Chaco region, which is an area viewed as sacred to indigenous people and is the home of the Chaco Culture National Historical Park. The case has now been sent back to the district court for further action.