Morning Highlights
Morning Highlights

7-20-23 Crude edges higher while products lag behind...

Riley Schwieger

Jul 20, 2023

Outlook: Energy momentum has stalled today with crude and products hovering around even this morning. Yesterday’s EIA report provided mixed results with a notable draw in Cushing stocks while product demand came in soft. Crude spreads remained soft yesterday despite the large Cushing draw and bull spread opportunities may be developing with SPR refills starting in August. A quiet week for economic reports is wrapping up, however, the jobless claim for last week came in less than expected for last week. The labor market continues to show resilience under elevated interest rates which provided optimism for a soft landing. The Fed will meet next Wednesday when the industry expects them to increase rates by another 25 bps. Energies will likely find comfort in its newly developed higher range until a fresh market driver develops.     


  • China’s imports of Russian crude rose to 2.56 million bpd in June, up 44% from year-ago levels according to customs data.
  • US oil exports to China were up 354% over last year (~700kbpd) due to favorable pricing over Middle East blends.
  • Today the US Senate will vote to block China, Russia, North Korea, and Iran from purchasing crude from the Strategic Petroleum Reserve.
  • The EIA reported crude stocks fell by 708,000 barrels last week.
  • Cushing stocks fell by 2.9 million barrels, which was the largest drop since October 2021.
  • The August WTI contract will expire today.
  • US weekly jobless claims was reported at 228,000 last week vs 240,000 est.
  • As of 7:55 am CST: Brent crude oil up $0.19 to $79.65, US dollar index up $0.207 to 100.488 while the nearby e-mini S&P 500 futures contract is down 12.25 to 4585.00.


  • The EIA reported diesel stocks rose by 13,000 barrels last week.
  • Diesel demand rose 23% w/w which recovered back the losses observed after the week of July 4th.
  • Seasonally, diesel demand fell to its lowest level since 2009.


  • The EIA reported gasoline stocks fell by 1.06 million barrels last week.
  • Gasoline demand was up 1.1% w/w at 8.85 mbpd.


  • Conway is trading at .6400 while Belvieu is trading at .6750.
  • Conway is trading at 34% of crude.
  • The US is exporting 62% of production as of 7/14/23.
  • The EIA reported propane stocks rose by 887,000 barrels.

Natural Gas

  • Overnight weather runs added 3 CDDs for the two-week forecast.
  • Yesterday, US natural gas demand rose to 102.9 Bcf/d.
  • The EIA is expected to report a 48 Bcf injection into storage for last week.

Russian Diesel Exports: Russian diesel exports have risen to around 81,000 bpd in the first half of July when compared to June data. Exports total around 2.49 mbpd and head for a 3-month high as refineries ramp back up according to Bloomberg data.