Last updateTue, 22 Jan 2019 8pm


Inventories Drive U.S. Refining Margins to Five-Year Lows

Flattening year-over-year growth in gasoline demand in the U.S., combined with high levels of refinery output, have contributed to low or negative motor gasoline refining margins for refiners along the East and Gulf Coasts. Gasoline refining margins—the difference between the spot price of gasoline and the Brent crude oil spot price—have been on a downward trend since August, and these margins have been at some of their lowest October and November levels in the past five years. At the same time, strong growth in distillate demand has driven increased distillate prices and refining margins. 

Qatar Quitting OPEC, Shifting Focus to Gas

Qatar, the world’s largest exporter of liquefied natural gas (LNG), is leaving the Organization of Petroleum Exporting Countries (OPEC) as of next month and will shift more of its attention to the gas sector from here on out.

Saad al-Kaabi, minister of state for energy affairs, criticized Saudi Arabia when making the announcement, stating, “We are not saying we are going to get out of the oil business, but it is controlled by an organization managed by a country.” 

U.S. Crude Oil, Natural Gas Proved Reserves Set New Records

High prices and continued development of shale and tight resources drove proved reserves of both U.S. crude oil and natural gas to new records in 2017, according to EIA’s recently released U.S. Crude Oil and Natural Gas Proved Reserves report.

Texas and New Mexico had the largest net increases in proved reserves of crude oil in 2017, adding 3.1 billion and 1.0 billion barrels of proved crude oil reserves, respectively. Increases in these states were primarily the result of increased crude oil prices and development in the Permian Basin, particularly in the stacked oil-bearing formations of the Spraberry Trend and the Wolfcamp/Bone Spring shale play. 

Chemical Activity a Potential Warning Sign to U.S. Economy

The Chemical Activity Barometer (CAB) from the American Chemistry Council (ACC) posted a 0.3% decline in November on a three-month moving average (3MMA) basis. This marks the barometer’s first month-over-month drop since February 2016 and adds to the chorus of growing concern of slowing U.S economic expansion. On a year-over-year basis the barometer is up 2.8% (3MMA), a marked slowdown in the pace of growth from earlier this year. The unadjusted measure of the CAB declined 0.8% in November and 0.6% in October. 

Ethylene Capacity Growth Forecast for U.S.

Another wave or two of ethylene capacity growth is in store for the U.S. in the next few years, as project developers maintain their confidence in the market, Trey Hamblet, Industrial Info's vice president of Chemical Processing Industry research, said at the company's recent Market Outlook in Baton Rouge, Louisiana. 

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