MMS Shut-In Report on Subtropical Depression Ten

Based on data from offshore operator reports submitted as of 11:30 a.m. CST today, personnel have been evacuated from a total of 77 production platforms, equivalent to 9.2 % of the 834 manned platforms in the Gulf of Mexico. Production platforms are the structures located offshore from which oil and natural gas are produced. These structures remain in the same location throughout a project’s duration unlike drilling rigs which typically move from location to location.

Personnel from 17 rigs have also been evacuated; this is equivalent to 19.1 % of the 89 rigs currently operating in the Gulf. Rigs can include several types of self-contained offshore drilling facilities including jackups, submersibles and semisubmersibles.

From the operators’ reports, it is estimated that approximately 62.7 % of the oil production in the Gulf has been shut-in. Estimated oil production from the Gulf of Mexico as of April 2007 was 1.3 million barrels of oil per day. It is also estimated that approximately 30.8 % of the natural gas production in the Gulf has been shut-in. Estimated natural gas production from the Gulf of Mexico as of April 2007 was 7.7 billion cubic of gas per day.

So... 62.7% of 1.3 mbpd means the US just lost 815,100 bpd. Crude oil consumption for June in the US (latest available data) was 622,095,000 barrels or 20,736,500 barrels per day. So for the duration of TD10, the US just lost 3.9% of its total crude oil supply. If we assume 3 days of shut-in (reasonable, might be 4) we are at about 2.5 million barrels lost. Have we seen 2.5 million barrels of refining capacity go offline yet for turn-around? If not, I'd expect lower crude inventories next week just on the TD10 data alone, unless someone can explain what other factors might change that.

"The greatest shortcoming of the human race is our inability to understand the exponential function." -- Dr. Albert Bartlett
Into the Grey Zone

And, gasoline stocks lower due to the Valero plant just reaching 100% today after 10 days down.

Actually I haven't confirmed they are restarted yet, they just planned to be up today.

Traders Perspective:

we're going to take out this week's highs.

If these numbers are correct, we may see 90-

the bids are just too high. We saw a jump from 81-84 in an hour from the bidding to get the oct contract.

Likely monday may see one of the usual "V" patterns that we have seen all over the commodities sectors recently. Tuesday, folks will be trying to beat the inventory report, and before the inventory report it could get even worse, and afterwards, looking at this recent news data point, its going to be another very bad week with a very large draw on both crude and gasoline. the MSM is going to try to focus on heating oil, but crude is where the attention is. But the numbers are there for everyone to see. Likely short covering rally after the report, which could take us lord knows how high. Maybe another "V" pattern thursday as those who really need the contracts, and not the hedge funds, will have learned from their mistake this week and be buying heavily after the inventory report to beat the rush.

And the week after and after that likely more rallies.

I think this is without the effect of geo-political events which would have us see 100 in matter of minutes. This is the world we live in.

are you long?

Nothing much to worry about in the New Orleans area. Even heavy rain* is unlikely

Bob Breck @ 6 PM

Alan :-)

^Heavy rain is 4 or 5 inches or more

What's weird is that the Weather Channel has the "eye"/Spin
going in at Ft Walton when the GOM Water Vapor Imagery
looks like it just went into Mobile Bay.

Arkansaw of Samuel L Clemens