By JOHN P. TRETBAR
Eagle Media
Crude prices rise slightly, after falling precipitously. Gasoline prices just keep rising. The benchmark NYMEX futures contract dropped ten percent Monday to settle at $88.13 per barrel, down $1.10. Kansas Common crude at CHS drops $10.25 to $78.25 per barrel. Prices in McPherson are twenty dollars higher than at the first of the month.
Offers returned to the plus column Tuesday with three percent gains here and abroad. WTI was over $91.00 a barrel at lunchtime. London Brent was trading over $102.00.
Gasoline prices are creeping upwards toward four dollars a gallon across the country. The national average is $3.97 per gallon Tuesday, an increase of a dollar and change in the last month. At $3.27 a gallon, Kansas offers the second-cheapest statewide gasoline prices, trailing Oklahoma by a penny. AAA reports diesel prices average $5.34 per gallon across the US, up a $1.50 in the last month. Kansas prices average $4.55 a gallon.
Baker Hughes reports an increase of two drilling rigs searching for oil in the US this week. The oil rig-count is down by 72 rigs from a year ago. Gas rigs this week drop by two from last week but are up by 29 rigs from last year at this time. The total of 552 rigs is the lowest since early March, following two weekly increases.
The Kansas Rig Count is up three in Western Kansas at nine rigs, and unchanged east of Wichita at six. The tally is up 87 percent from a month ago, but down eleven percent from a year ago. Drilling continued on leases in Stafford, Finney, Haskell and Graham counties.
A total of 99 wells have been drilled from spud to full depth in Kansas this year. This is 87 fewer wells than a year ago. Out of 14 new well-completions in Kansas this week, five are dry holes, and three are service or disposal wells. Independent Oil and Gas Service reports 153 completions so far this year, compared to 269 a year ago. This week's report includes new completions in Finney, Gove, Haskell, Russell and Stafford counties.
Kansas regulators okayed eleven new drilling locations in Kansas with seven in eastern Kansas, and four west of Wichita. That's 96 new drilling permits this year, compared to 158 a year ago.
US strategic crude-oil stockpiles were unchanged but officials were expecting a massive release to hit the marketplace by late last week. The Energy Department okayed the release of more than 80 million barrels from the US Strategic Petroleum Reserves, as part of a larger international effort. That’s about half of the expected 172 million barrels the US has pledged to sell, in an effort to tame crude prices.
U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) rose by 6.2 million barrels. At 449.3 million barrels, U.S. crude oil inventories are about one percent below the five-year average for this time of year.
Domestic crude production drops slightly this week, to 13.7 million barrels a day. The four-week average and cumulative annual production are each over 13.6 million daily barrels.
US fuel inventories dropped this week. Demand for regular gasoline is lower, but diesel demand is up from a year ago.
With rising prices for diesel and jet fuel, so called distillate fuels, comes word that prices have tripled for distillate-fuel storage tanks. Reuters reports US traders are betting that rising prices in Europe and Asia will bolster exports of US refined products. Also, the Trump administration is expected to announce soon that it will temporarily lift federal smog-cutting restrictions on summer-blend gasoline to curb rising prices.
The price of the nitrogen-based fertilizer called component called urea has increased by 25% since the end of February, if you can find it. Secretary of Agriculture Brooke Rollins said last week the White House was looking at “every potential avenue to keep” these prices down. Two antitrust class action lawsuits allege major players in the U.S. fertilizer industry have colluded to artificially inflate prices.
A recent analysis of U.S. airline ticket prices found that average domestic airfares for travelers booking flights later in March have climbed by between 15% and 124%. CBS reported the average fare for transcontinental flights has more than doubled.
Crude production in the number-three producing state dropped slightly in January. The latest numbers from the North Dakota Department of Mineral Resources show output of just over one-point-one-two-four (1.124) million barrels a day, down from one-point-one-two-SIX (1.126) million in December. Natural gas production dropped slightly. DMR reports an increase to 95.3 percent in the amount of natural gas captured at oil wells, but also four percent increase in the amount burned off at the well head.