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Guernsey Space Tightens as Brent Surges · The Gathering Line

• 0:00
  Monday brief, covering since Friday morning.
• 0:03
  December nominations are locked and the rig count printed flat at six hundred and
• 0:07
  three, so the focus shifts from deadline scrambles to who actually gets space.
• 0:13
  Global first.
• 0:14
  Brent gained three dollars fifty five, or three point one four percent,
• 0:18
  on Friday.
• 0:20
  Trading Economics has it between a hundred sixteen dollars seventy two cents and a
• 0:24
  hundred sixteen ninety one depending on the feed.
• 0:27
  That's the highest since June twenty twenty two, and up more than six percent on the
• 0:31
  week.
• 0:32
  The driver is Iran.
• 0:35
  President Trump said Washington is not negotiating with Tehran and that something
• 0:39
  happens fairly soon.
• 0:41
  Reports say the U.S.
• 0:42
  and Israel have drawn up strikes for after the midterms.
• 0:46
  Iran's army chief says the military is ready for asymmetric warfare.
• 0:50
  Houthi attacks on Saudi Arabia continue, the State Department ordered nonessential
• 0:54
  personnel out, and Aramco told Dhahran headquarters staff to evacuate and work
• 0:59
  remotely.
• 1:00
  On supply, O P E C plus quotas are unchanged going into the November first
• 1:06
  ministerial.
• 1:07
  JODI data via OilPrice has Saudi August output at six point two four million barrels
• 1:13
  per day, with exports of four point four five million sustained by drawing domestic
• 1:18
  stocks, not new drilling.
• 1:21
  The point for your book is freight.
• 1:23
  RBN reports supertanker fixtures from the Gulf Coast to Asia above eighty million
• 1:29
  dollars, and Goldman puts waterborne freight near twenty dollars a barrel against
• 1:33
  three historically.
• 1:35
  That wedge is why inland light sweet isn't capturing the Brent premium.
• 1:40
  North America.
• 1:41
  Western Canadian Select for November at Hardisty settled at a dollar twenty five
• 1:45
  fifty five under W T I, per CalRock via Reuters.
• 1:50
  That's thirty five cents wider than Thursday's twenty five twenty.
• 1:54
  The implied outright is about seventy seven seventy two on Friday's W T I,
• 1:58
  and that figure is calculated, not a physical trade.
• 2:02
  Freight and soft Gulf Coast fuel oil are behind the blowout.
• 2:06
  Western Canadian export pipes are running around ninety three percent.
• 2:09
  T M X is throttled near sixty percent, about four hundred twenty five thousand
• 2:13
  barrels per day, because the trans Pacific arbitrage is shut,
• 2:17
  which pushes Canadian barrels toward P A D D two.
• 2:21
  Enbridge's Express is full at two hundred eighty thousand barrels per day into
• 2:25
  Casper and Guernsey.
• 2:27
  Mexico, nothing material.
• 2:29
  United States.
• 2:30
  No new E I A release since Wednesday, so that report is still the baseline.
• 2:35
  Commercial crude fell three point zero six one million barrels to about four hundred
• 2:39
  twelve and a half million, a bigger draw than the one point three million consensus.
• 2:44
  But the draw was coastal.
• 2:46
  P A D D three drew five point oh four one million on storm shut ins.
• 2:51
  Inland built.
• 2:52
  P A D D four, the Rockies, added seven hundred eighty six thousand barrels to twenty
• 2:56
  three point five million, and Cushing added one million to twenty seven point six
• 3:00
  million, a fourth straight weekly build.
• 3:03
  Output was thirteen point two seven million barrels per day,
• 3:06
  refinery runs slipped to ninety three point four percent, and the S P R is at two
• 3:11
  hundred eighty two point seven million, the lowest since nineteen eighty two.
• 3:15
  W T I settled at a hundred and three dollars twenty seven cents,
• 3:19
  up three eighty, or three point eight two percent, from Thursday's ninety nine forty
• 3:23
  seven.
• 3:24
  Baker Hughes had the total flat at six hundred and three for a second week,
• 3:28
  up fifty three year over year.
• 3:30
  Oil rigs rose one to four hundred sixty, gas fell one to one thirty two.
• 3:35
  Triple digit crude and no added rigs tells you producers are holding to discipline.
• 3:39
  Don't underwrite basin volume growth off this price.
• 3:43
  Corporate: Devon is selling its Eagle Ford assets to Crescent Energy for four point
• 3:47
  two two billion cash.
• 3:49
  Antitrust reviews continue on Enbridge's two point five five billion dollar
• 3:53
  Tallgrass crude deal, including seventy five percent of Pony Express,
• 3:57
  and on Hess Midstream's roughly two hundred million dollar purchase of Chevron's D J
• 4:01
  Basin gathering plus a twenty percent Saddlehorn stake.
• 4:05
  Uinta Basin.
• 4:06
  These netbacks are market desk figures, so treat them as indicative.
• 4:11
  Yellow wax wellhead is holding ten to fourteen dollars under Cushing.
• 4:15
  Delivered Gulf Coast wax is W T I plus three twenty, about a hundred six forty
• 4:20
  seven.
• 4:21
  Less sixteen to eighteen dollars of heated railcar freight,
• 4:24
  the netback is roughly eighty eight forty seven to ninety forty seven,
• 4:28
  twelve eighty to fourteen eighty under Cushing.
• 4:31
  Spot rail is underwater against Salt Lake City postings.
• 4:34
  The five Salt Lake refiners are running around eighty thousand barrels per day of
• 4:38
  wax, which is their ceiling.
• 4:40
  Uinta rail loadings are near a hundred fifteen thousand, all anchored by minimum
• 4:44
  volume commitments, with spot racks idle.
• 4:47
  Wildcat's Helper terminal is expanding toward a hundred thousand.
• 4:51
  Energy Transfer's Price River rail terminal is in state review,
• 4:54
  targeting a fourth quarter decision.
• 4:56
  The Uinta Basin Railway has zero track laid.
• 5:00
  After the Supreme Court ruling, the D.C.
• 5:02
  Circuit formally remanded the case to the Surface Transportation Board in October.
• 5:07
  The Board's approval stays intact, but deeper review is required on downstream
• 5:12
  emissions and accident risk, and the Forest Service right of way is paused until the
• 5:17
  revised order.
• 5:19
  Operators including Ovintiv, XCL, Scout, Veren, Berry, Caerus and SM
• 5:25
  Energy are on steady schedules.
• 5:28
  Bakken.
• 5:29
  The Director's Cut has state output near one point one five three million barrels
• 5:33
  per day, thirty three rigs, ninety six percent gas capture,
• 5:37
  and about a hundred thirty million cubic feet per day flared.
• 5:41
  Dakota Access is fully subscribed at an effective seven hundred fifty thousand
• 5:45
  barrels per day, with walk up tariffs at nine seventy five against five sixteen to
• 5:50
  seven fifty six committed.
• 5:52
  The Double H conversion to N G L service removed sixty five to eighty eight thousand
• 5:56
  barrels per day of crude takeaway, so egress is concentrating on D A P L and
• 6:01
  Bridger.
• 6:02
  All in rail to the coast is ten to fifteen dollars before car leases and rack
• 6:06
  tariffs, and spot crude by rail is closed.
• 6:09
  Rail loadings are M V C only.
• 6:12
  Chevron drops one Williston rig by December, down to two, to pursue longer laterals.
• 6:17
  Hess Midstream sees gathering volumes down about five percent by twenty twenty seven
• 6:22
  before leveling off.
• 6:23
  Chord, Continental, Devon, Grayson Mill and ConocoPhillips are steady.
• 6:28
  Powder River.
• 6:29
  Anschutz, Continental, Devon, EOG and Peak are drilling steadily.
• 6:35
  Gathering has room, but congestion sits at the receipt manifolds feeding the
• 6:40
  Guernsey headers.
• 6:42
  Plains is integrating the Silver Creek system.
• 6:45
  Now GERN-zee, the one that matters.
• 6:48
  Guernsey Sweet was flat over the last twenty four hours at eighty five cents over
• 6:52
  Cushing, about a hundred four twelve outright.
• 6:56
  Clearbrook sits a dollar fifty to two ten under Guernsey, or sixty five cents to a
• 7:00
  dollar twenty five under Cushing.
• 7:03
  Inflows are heavy.
• 7:04
  Express brings two hundred eighty thousand barrels per day,
• 7:08
  and Bridger and Belle Fourche add over three hundred thousand of Bakken.
• 7:11
  The squeeze is on the way out.
• 7:14
  Pony Express is limited to about two hundred thirty thousand barrels per day against
• 7:18
  a four hundred thirty thousand nameplate, on refinery limits and allocations.
• 7:22
  Platte, at a hundred forty five thousand eastbound to Wood River and Patoka,
• 7:26
  is heavily prorated.
• 7:28
  Saddlehorn and Grand Mesa are full of D J barrels bound for Cushing.
• 7:32
  With December nominations closed Friday, secondary market allocations decide flows.
• 7:38
  An uncommitted barrel without space on a southbound pipe either takes the dollar
• 7:41
  fifty to two ten discount to go northeast to Clearbrook, or sits in Guernsey
• 7:46
  tankage.
• 7:47
  Longer term, Bridger's proposed five hundred fifty thousand barrel per day,
• 7:52
  thirty six inch line from the Canadian border, targeting July twenty twenty seven,
• 7:57
  adds a lot of receipts.
• 7:59
  East Daley's point is that Guernsey can't absorb them without downstream looping on
• 8:04
  Pony Express, which makes the Bridger and Tallgrass open season the one to watch.
• 8:09
  That's the brief.