Oil Boom Profits

Working gas in storage was 1,511 Bcf as of Friday, March 23, 2007, according to EIA estimates. This represents a net decline of 22 Bcf from the previous week. Stocks were 209 Bcf less than last year at this time and 267 Bcf above the 5-year average of 1,244 Bcf. In the East Region, stocks were 76 Bcf above the 5-year average following net withdrawals of 41 Bcf. Stocks in the Producing Region were 149 Bcf above the 5-year average of 448 Bcf after a net injection of 13 Bcf. Stocks in the West Region were 42 Bcf above the 5-year average after a net addition of 6 Bcf. At 1,511 Bcf, total working gas is within the 5-year historical range.

Summary of Weekly Petroleum Data for the Week Ending March 23, 2007

U.S. crude oil refinery inputs averaged nearly 15.0 million barrels per day
during the week ending March 23, up 167,000 barrels per day from the previous
week's average.  Refineries operated at 87.0 percent of their operable capacity
last week.  Gasoline production increased slightly compared to the previous
week, averaging over 8.9 million barrels per day, while distillate fuel
production decreased, averaging over 4.0 million barrels per day.

U.S. crude oil imports averaged over 9.6 million barrels per day last week, down
786,000 barrels per day from the previous week. Over the last four weeks, crude
oil imports have averaged nearly 9.7 million barrels per day, or 159,000 barrels
per day less than averaged over the same four-week period last year.  Total
motor gasoline imports (including both finished gasoline and gasoline blending
components) last week averaged over 1.1 million barrels per day. Distillate fuel
imports averaged 349,000 barrels per day last week.

U.S. commercial crude oil inventories (excluding those in the Strategic
Petroleum Reserve) fell by 0.9 million barrels compared to the previous week. 
At 328.4 million barrels, U.S. crude oil inventories are above the upper end of
the average range for this time of year.  Total motor gasoline inventories
declined by 0.3 million barrels last week, and are in the upper half of the
average range.  Distillate fuel inventories decreased by 0.7 million barrels,
and are near the upper end of the average range for this time of year.  Most of
the decline was in heating oil inventories (high- sulfur), while diesel fuel
inventories (the sum of ultra-low and low- sulfur) inventories were relatively
unchanged. Propane/propylene inventories fell by 0.7 million barrels last week.
Total commercial petroleum inventories increased by 0.4 million barrels last
week, and are in the upper half of the average range for this time of year.

Total products supplied over the last four-week period has averaged 21.1 million
barrels per day, or 2.4 percent above the same period last year.  Over the last
four weeks, motor gasoline demand has averaged 9.2 million barrels per day, or
1.6 percent above the same period last year.  Distillate fuel demand has
averaged above 4.4 million barrels per day over the last four weeks, unchanged
compared to the same period last year. Jet fuel demand is up 3.8 percent over
the last four weeks compared to the same four-week period last year.

The U.S. Department of Energy announced its aim to buy up to 4 million barrels of crude oil for the Strategic Petroleum Reserve.

"The Strategic Petroleum Reserve is a critical national asset that bolsters our energy security," Energy Secretary Samuel Bodman said. "By replenishing the Strategic Petroleum Reserve, we can ensure that there are additional supplies of fuel for the American people in cases of severe supply disruption."

The SPR capacity is 727 million barrels and currently holds 689 million barrels. The purchases will occur spread out over the next few months and bids will be accepted based on fair market value.

The department's end goal is to fill the reserves during May, June and July at a rate of 100,000 barrels per day.

The two sites that may receive either some or all of the additional reserves are the West Hackberry, La., site, and the Bryan Mound, Texas, site. Energy Department will accept bids through April 3 and make final decisions by the following week.

The revenue from the emergency sale in 2005 will be used to purchase the replacement barrels for the Strategic Petroleum Reserve.

In the months following Hurricane Katrina in the fall of 2005, 11 million barrels of oil were sold to make up for the losses. These upcoming sales transactions would be the first direct purchase of crude oil for the reserve since 1994.

Working gas in storage was 1,516 Bcf as of Friday, March 9, 2007, according to EIA estimates. This represents a net decline of 115 Bcf from the previous week. Stocks were 324 Bcf less than last year at this time and 158 Bcf above the 5-year average of 1,358 Bcf. In the East Region, stocks were 35 Bcf above the 5-year average following net withdrawals of 92 Bcf. Stocks in the Producing Region were 103 Bcf above the 5-year average of 461 Bcf after a net withdrawal of 22 Bcf. Stocks in the West Region were 19 Bcf above the 5-year average after a net drawdown of 1 Bcf. At 1,516 Bcf, total working gas is within the 5-year historical range.

Oil prices inched up Wednesday after a government report showed that crude stocks rose less than expected last week while product inventories fell more than analysts had forecast.

Light, sweet crude for April delivery rose 2 cents to $57.95 a barrel in late morning trading on the New York Mercantile Exchange.

The Brent crude contract for April added 5 cents to $60.95 a barrel on the ICE Futures exchange in London.

The Energy Department reported Wednesday that crude inventories rose last week to 325.3 million barrels, up by 1.1 million barrels, higher than analyst expectations. Analysts polled by Dow Jones Newswires estimated an average gain of 1.4 million barrels.

Meanwhile, gasoline inventories fell by 2.5 million barrels last week, above expectations of a 2.1 million barrel decline. Inventories for distillate stocks – which include heating oil and diesel fuel – fell by 2.8 million barrels, more than estimates of a 1.9 million barrel drop.

Crude, gasoline and distillate inventories are at the upper end of average for this time of year.

The drawdown in gasoline stocks failed to inspire any buying, with gasoline futures edging down less than a penny to $1.9226 a gallon. Heating oil futures gained a fraction of a cent to $1.6935 a gallon.

“Overall, all the numbers are very bullish. There is nothing bearish at all about this report,” said Phil Flynn, an energy analyst at Alaron Trading Corp. in Chicago. “But I think traders are still concerned that the stock market is soft.”

The April crude contract dipped by almost a dollar on Tuesday to settle at $57.93 a barrel following a decline in Wall Street which stirred worries about the U.S. economy and demand for energy.

The Organization of Petroleum Exporting Countries is set to meet on Thursday amid expectations that oil ministers would opt to keep output steady.

In other Nymex trading, natural gas prices rose 8.6 cents to $6.978 per 1,000 cubic feet.

Oil rose after the International Energy Agency said oil stockpiles in industrialized countries are headed for their biggest decline in 10 years this quarter because of cold February weather and OPEC's supply cuts.

Crude supplies in the 30 member states of the Organization for Economic Cooperation and Development fell by 1.26 million barrels a day in January and February, the IEA said today in its monthly report. U.S. gasoline stockpiles probably fell 2.45 million barrels in the week ended March 9, according to a Bloomberg News survey of 12 analysts before a Department of Energy report tomorrow.

Working gas in storage was 1,631 Bcf as of Friday, March 2, 2007, according to EIA estimates. This represents a net decline of 102 Bcf from the previous week. Stocks were 268 Bcf less than last year at this time and 194 Bcf above the 5-year average of 1,437 Bcf. In the East Region, stocks were 70 Bcf above the 5-year average following net withdrawals of 78 Bcf. Stocks in the Producing Region were 113 Bcf above the 5-year average of 473 Bcf after a net withdrawal of 6 Bcf. Stocks in the West Region were 12 Bcf above the 5-year average after a net drawdown of 18 Bcf. At 1,631 Bcf, total working gas is within the 5-year historical range.

Oil prices jumped by more than $1 per barrel Wednesday, after the U.S. government reported an unexpected drop in crude oil inventories last week.

Light, sweet crude for April delivery surged $1.12 to $61.81 a barrel in morning trading on the New York Mercantile Exchange.

Brent crude for April delivery spiked $1.01 to $62.40 a barrel on London's ICE Futures Exchange.

The U.S. Energy Information Administration said crude oil stockpiles fell by 4.8 million barrels to 324.2 million barrels last week. Analysts, on average, had been expecting an increase in crude inventories of 2 million barrels, according to a Dow Jones Newswires survey.

Total gasoline inventories fell by 3.8 million barrels to 216.4 million barrels, a sharper decline than the 1.4 million barrel drop that analysts had expected.

Distillate fuel inventories, which include diesel and heating oil, fell by 1.3 million barrels to 123.2 million, compared with the 2.3 million barrel slide analysts had expected.

Heating oil futures rose 2.07 cents to $1.768 a gallon and natural gas gained less than a penny to $7.475 per 1,000 cubic feet. Gasoline futures rose 2.92 cents to $1.8825.

Also buoying crude prices was a U.S. Energy Information Administration's short-term energy outlook released Tuesday. The EIA predicted that oil demand will be 2.7 percent higher in the first quarter of 2007 than the same period a year ago, and that natural gas demand will surge 11 percent this year from 2006.

Bitterly cold winds will buffet the Northeast Tuesday, especially eastern New York state and New England. Wind chill temperatures, mainly in the morning, will be dangerously low.

A few snow showers or flurries will fly in Upstate New York and northern New England, but no important accumulations are likely.

High temperatures will be far below early March expectations with readings--not factoring in wind chill-- ranging from the single digits in much of New York state and northern New England to the 40s across southern Virginia.

Working gas in storage was 1,733 Bcf as of Friday, February 23, 2007, according to EIA estimates. This represents a net decline of 132 Bcf from the previous week. Stocks were 263 Bcf less than last year at this time and 179 Bcf above the 5-year average of 1,554 Bcf. In the East Region, stocks were 71 Bcf above the 5-year average following net withdrawals of 98 Bcf. Stocks in the Producing Region were 91 Bcf above the 5-year average of 501 Bcf after a net withdrawal of 24 Bcf. Stocks in the West Region were 16 Bcf above the 5-year average after a net drawdown of 10 Bcf. At 1,733 Bcf, total working gas is within the 5-year historical range.