tables & graphs for December 14

OPEC production:

November 2019 OPEC crude output via secondary sources

additional OPEC cuts:

OPEC additional supply cuts as of December 2019

global oil supply:

November 2019 OPEC report global oil supply

global oil demand 2019:

November 2019 OPEC report global oil demand

global oil demand 2020:

November 2019 OPEC report global oil demand for 2020

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November’s jobs report; October’s trade deficit, construction spending, factory inventories and wholesale sales

In addition to the Employment Situation Summary for November from the Bureau of Labor Statistics, this week’s economic releases included four reports that will feed into 4th quarter GDP: the Commerce Department report on our International Trade for October, the October report on Construction Spending (pdf), the Full Report on Manufacturers’ Shipments, Inventories and Orders for October, and the October report on Wholesale Trade, Sales and Inventories, all from the Census Bureau…in addition, late on Friday the Fed released the Consumer Credit Report for October, which indicated that overall consumer credit, a measure of non-real estate debt, expanded by a seasonally adjusted $18.9 billion, or at a 5.5% annual rate, as non-revolving credit expanded at a 4.3% rate to $3,076.6 billion and revolving credit outstanding increased at a 8.8% rate to $1,088.7 billion…

The week’s major privately issued reports included the ADP Employment Report for November; the light vehicle sales report for November from Wards Automotive, which estimated that such vehicles sold at a 17.09 million annual rate in November, up from the 16.55 million annual rate in October, but down from the 17.40 million annual rate in November a year ago; and both of the widely followed purchasing manager’s surveys from the Institute for Supply Management (ISM): the November Manufacturing Report On Business indicated that the manufacturing PMI (Purchasing Managers Index) fell to 48.1% in November, down from 48.3% in October, indicating an ongoing contraction in US manufacturing, and the October Non-Manufacturing Report On Business; which saw the NMI (non-manufacturing index) fall to 53.9% in November, down from 54.7% in October, meaning a smaller plurality of service industry purchasing managers reported expansion in various facets of their business in November than in October…both of those ISM reports are easy to read and include anecdotal comments from purchasing managers from the 34 business types who participate in those surveys nationally…  

Employers Add 266,000 Jobs in November, Unemployment Rate and Labor Force Participation Rate Both Lower

The Employment Situation Summary for November reported the strongest job creation since January, while the unemployment rate and the labor force participation rate both fell…estimates extrapolated from the seasonally adjusted establishment survey data projected that employers added 266,000 jobs in November, after the previously estimated payroll job increase for September was revised up from up from 180,000 to 193,000 and the payroll jobs increase for October was revised up from 128,000 to 156,000…that means that this report represents a total of 307,000 more seasonally adjusted payroll jobs than were reported last month, with the caveat that the November figures includes the return of 48,000 GM workers who were on strike during the BLS reference week for October…the unadjusted data, meanwhile, shows that there were actually 622,000 more payroll jobs extent than in October, 466,400 of which were seasonal jobs additions in the retail sector…

Seasonally adjusted job increases in November were spread throughout the private goods producing and service sectors, with the 7,000 jobs lost in the mining and logging sector and the 4,300 jobs lost in wholesale trade the only notable decreases…the largest job increase was seen in the health care and social assistance sector, which added 60,200 jobs, with the addition of 16,100 jobs in doctor’s offices and 11,100 jobs in individual and family services.…another 54,000 jobs were added in manufacturing, as the end of the GM strike resulted in a 42,100 net increase of those employed in the manufacture of transportation equipment…the leisure and hospitality sector added 45,000 jobs, including 25,300 more jobs in bars and restaurants and 8,700 additional jobs in amusements, gambling, and recreation…the broad professional and business services sector added 38,000 more jobs, with 8,400 of those working in architectural and engineering services and 5,800 employed by computer systems design and related services….at the same time, 15,500 jobs were added in transportation and warehousing, with 8,000 of those employed in warehouses, and 13,800 more were employed in private education services….in addition, both the financial sector and the information sector each saw the addition of 13,000 jobs during November, while 12,000 more jobs were added in various branches of government…that leaves only the retail sector, with a 2,000 job increase after the seasonal adjustment, and construction, with a 1,000 job increase, as the only major sectors we’d consider virtually unchanged…

The establishment survey also showed that average hourly pay for all employees rose by 7 cents an hour to $28.29 an hour in November, after it had increased by an upwardly revised 10 cents an hour in October; at the same time, the average hourly earnings of production and non-supervisory employees increased by 7 cents to $23.83 an hour…employers also reported that the average workweek for all private payroll employees was unchanged at 34.4 hours in November, while weekly hours for production and non-supervisory personnel was unchanged at 33.5 hours…at the same time, the manufacturing workweek increased by 0.1 hour to 40.5 hours, while average overtime decreased by 0.1 hour to 3.1 hours…

Meanwhile, the November household survey indicated that the seasonally adjusted extrapolation of those who reported being employed rose by an estimated 83,000 to 158,593,000, while the estimated number of those unemployed and looking for work fell by 44,000 to 5,811,000, and as a result the total labor force increased by a rounded total of 40,000….since the working age population had grown by 175,000 over the same period, that meant the number of employment aged individuals who were not in the labor force rose by a rounded 135,000 to 95,616,000, which was enough to lower the labor force participation rate from 63.3% in October to 63.2% in November….meanwhile, the increase in number employed as a percentage of the increase in the population was not enough to statistically change the employment to population ratio, which we could think of as an employment rate, as it remained at 61.0%….on the other hand, the decrease in the number unemployed was just enough to lower the unemployment rate, which fell from 3.6% to 3.5%, matching the lowest rate since December 1969…meanwhile, the number of those who reported they were forced to accept just part time work fell by 116,000, from 4,438,000 in October to 4,322,000 in November, which was enough to lower the alternative measure of unemployment, U-6, which includes those “employed part time for economic reasons”, from 7.0% of the labor force in October to 6.9% in November, thus matching a 19 year low…

Like most reports from the Bureau of Labor Statistics, the employment situation press release itself is easy to read and understand, so you can get more details on these two reports from there…note that almost every paragraph in that release points to one or more of the tables that are linked to on the bottom of the release, and those tables are also on a separate html page here that you can open it along side the press release to avoid the need to scroll up and down the page.. 

October Trade Deficit Falls 7.6% on Lower Imports of Consumer & Automotive Goods

Our trade deficit fell 7.6% in October as the value of both our exports and our imports decreased, but our imports decreased by more….the Commerce Dept report on our international trade in goods and services for October indicated that our seasonally adjusted goods and services trade deficit fell by $3.9 billion to $47.2 billion in October from a revised September deficit of $51.1 billion, which had previously been reported as a deficit of $52.5 billion…the value of our October exports fell by a rounded $0.4 billion to $207.1 billion on a $0.8 billion decrease to $136.1 billion in our exports of goods and a $0.3 billion increase to $71.1 billion in our exports of services, while our imports fell by a rounded $4.3 billion to $254.3 billion on a $4.5 billion decrease to $204.1 billion in our imports of goods, partly offset by a $0.1 billion increase to $50.2 billion in our imports of services…export prices were on average 0.1% lower in October, which means the relative real decrease in exports for the month was smaller than the nominal decrease by that percentage, while import prices were 0.5% lower, meaning the decrease in real imports was smaller than the nominal dollar change reported here by that percentage…put another way, a fraction of the decrease in the value of October trade was due to lower prices..

The decrease in our October exports of goods resulted from lower exports of consumer goods, capital goods, automotive products and soybeans, which were partly offset by increases in exports of industrial supplies and materials and other goods…referencing the Full Release and Tables for October (pdf), in Exhibit 7 we find that our exports of consumer goods fell by $744 million to $16,623 million on a $436 million decrease in our exports of pharmaceutical preparations and a $354 million decrease in our exports of gem diamonds, and that our exports of capital goods fell by $391 million to $44,718 million on a $587 million decrease in our exports of engines for civilian aircraft which was partially offset by $309 million increase in our exports of industrial machines other than those itemized separately….in addition, our exports of automotive vehicles, parts, and engines fell by $311 million to $12,966 million as a $316 million decrease in our exports of trucks, buses, and special purpose vehicles and a $250 million decrease in our exports of parts and accessories other than engines, chassis and tires was partially offset by a $374 million increase in our exports of passenger cars, while our exports of foods, feeds and beverages fell by $281 million to $10,477 million on a $794 million decrease in our exports of soybeans…partially offsetting the decreases in those export categories, our exports of industrial supplies and materials rose by $556 million to $44,562 million on a $629 million increase in our exports of crude oil, a $379 million increase in our exports of precious metals other than those itemized separately, and a $210 million increase in our exports of natural gas liquids, which were partially offset by a $364 million decrease in our exports of fuel oil, while our exports of other goods not categorized by end use rose by $464 million to $6,103 million……

Exhibit 8 in the Full Release and Tables gives us seasonally adjusted details on our goods imports and shows that lower imports of consumer goods and of automotive goods were the largest factors in the $4.5 billion decrease in our goods imports….our imports of consumer goods fell by $2404 million to $52,314 million on a $783 million decrease in our imports of pharmaceutical preparations, a $374 million decrease in our imports of cell phones, a $338 million decrease in our imports of cotton apparel and household goods, and a $314 million decrease in our imports of toys, games and sporting goods, and our imports of automotive vehicles, parts and engines fell by $1,801 million to $29,049 million on a $768 million decrease in our imports of parts and accessories other than engines, chassis and tires, a $498 million decrease in our imports of new and used passenger cars, and a $464 million decrease in our imports of trucks, buses, and special purpose vehicles…..in addition, our imports of industrial supplies and materials fell by $528 million to $41,390 million as a $820 million decrease in our imports crude oil was offset by a $469 million increase in our imports of petroleum products other than fuel oil and a $315 million increase in our imports fuel oil, and our imports of foods, feeds, and beverages fell by $370 million to $12,403 million…slightly offsetting the decreases in those import categories, our imports of capital goods rose by $399 million to $56,563 million as a $628 million increase in our imports of semiconductors, a $620 million increase in our imports of computers, a $303 million increase in our imports of computer accessories and a $259 million increase in our imports of telecommunications equipment was offset by a $437 million decrease in our imports of engines for civilian aircraft, and a $334 million decrease in our imports of industrial machines other than those itemized separately, and our imports of other goods not categorized by end use rose by $141 million to $10,530 million…

The Full Release and Tables pdf for this month’s report also summarizes Exhibit 19, which gives us surplus and deficit details on our goods trade with selected  countries:

The October figures show surpluses, in billions of dollars, with South and Central America ($4.7), OPEC ($1.9), Hong Kong ($1.8), Brazil ($1.2), United Kingdom ($0.8), Singapore ($0.6), and Saudi Arabia ($0.6). Deficits were recorded, in billions of dollars, with China ($27.8), European Union ($14.3), Mexico ($7.8), Germany ($5.0), Japan ($4.5), Canada ($3.4), Italy ($2.6), France ($2.0), India ($2.0), Taiwan ($1.6), and South Korea ($1.5).

  • • The deficit with Japan decreased $1.4 billion to $4.5 billion in October. Exports increased $0.6 billion to $6.4 billion and imports decreased $0.9 billion to $10.9 billion.
  • • The deficit with the European Union decreased $1.3 billion to $14.3 billion in October. Exports increased $0.5 billion to $28.7 billion and imports decreased $0.9 billion to $43.0 billion.
  • • The deficit with Canada increased $0.8 billion to $3.4 billion in October. Exports decreased $0.7 billion to $23.8 billion and imports increased $0.2 billion to $27.2 billion.

The $1.35 billion downward revision to the September trade deficit will have the effect of decreasing the annualized 3rd quarter trade deficit by about $4.4 billion, which would increase reported 3rd quarter GDP growth by about 0.06 percentage points from previously published figures (assuming that inflation adjustments are similar)…meanwhile, to estimate the impact of October trade in goods on 4th quarter GDP growth figures, we use exhibit 10 in the pdf for this report, which gives us monthly goods trade figures by end use category and in total, already adjusted in chained 2012 dollars, the same inflation adjustment used by the BEA to compute trade figures for GDP, with the exception that they are not annualized here….from that table, we can figure that 3rd quarter real exports of goods averaged 149,243.3 million monthly in 2012 dollars, while inflation adjusted October exports were at 147,801 million in that same 2012 dollar quantity index representation… annualizing the change between those two figures, we find that October’s real exports of goods are running at a 3.80% annual rate below those of the 3rd quarter, or at a pace that would subtract about 0.21 percentage points from 4th quarter GDP if continued through November and December…..in a similar manner, we find that our 3rd quarter real imports of goods averaged 233,955.7 million monthly in chained 2012 dollars, while inflation adjusted October goods imports were at 226,933 million in that same 2012 dollar representation…that would indicate that so far in the 4th quarter, we have seen our real imports decrease at annual rate of 11.48% from those of the 3rd quarter…since imports subtract from GDP because they represent the portion of consumption or investment that occurred during the quarter that was not produced domestically, their decrease at a 11.48% rate would conversely add 1.47 percentage points to 4th quarter GDP….hence, if the October trade deficit is maintained at the same level throughout the 4th quarter, our improving balance of trade in goods would add a net of roughly 1.26 percentage points to the growth of 4th quarter GDP…..however, note that we have not included the impact of the less volatile change in services in our figures here because the BEA does not provide inflation adjusted data on those, and we don’t have an easy way to adjust for all their price changes…

Construction Spending Fell 0.8% in October after Prior Months Were Revised Much Higher

The Census Bureau’s report on construction spending for October (pdf) estimated that the month’s seasonally adjusted construction spending would work out to $1,291.1 billion annually if extrapolated over an entire year, which was 0.8 percent (±1.0 percent)* below the revised annualized September estimate of $1,301.8 billion but still 1.1  percent (±1.5 percent)* above the estimated annualized level of construction spending in October of last year. The annualized September construction spending estimate was revised 0.6% higher, from $1,293.6 billion to $1,301.8  billion, while the annual rate of construction spending for August was revised nearly 1.5% higher, from $1,287.1 billion to $1,305.986 billion.  The combined upward revisions of $27.1 billion to annualized August and September construction spending figures would be averaged over the 3 months of the quarter and increase the annualized 3rd quarter construction figure by around $9.0 billion ex any inflation adjustment, which would thus suggest a upward revision of about 0.20 percentage points to third quarter GDP when the third estimate is released on December 20th…

A further breakdown of the different subsets of construction spending is provided in a Census summary, which precedes the detailed spreadsheets:

  • Private Construction: Spending on private construction was at a seasonally adjusted annual rate of $956.3 billion, 1.0 percent (±0.7 percent) below the revised September estimate of $966.1 billion. Residential construction was at a seasonally adjusted annual rate of $508.2 billion in October, 0.9 percent (±1.3 percent)* below the revised September estimate of $512.6 billion. Nonresidential construction was at a seasonally adjusted annual rate of $448.1 billion in October, 1.2 percent (±0.7 percent) below the revised September estimate of $453.5 billion.
  • Public Construction: In October, the estimated seasonally adjusted annual rate of public construction spending was $334.8 billion, 0.2 percent (±1.6 percent)* below the revised September estimate of $335.6 billion. Educational construction was at a seasonally adjusted annual rate of $83.3 billion, 2.5 percent (±2.6 percent)* above the revised September estimate of $81.3 billion. Highway construction was at a seasonally adjusted annual rate of $95.0 billion, 2.2 percent (±3.9 percent)* below the revised September estimate of $97.1 billion.

As you can see from the above, construction spending would be included in 3 subcomponents of GDP; investment in private non-residential structures, investment in residential structures, and into government investment outlays, for both state and local and Federal governments…however, getting an accurate read on the impact of October spending reported in this release on 4th quarter GDP is difficult because all figures given here are in nominal dollars and as you know, data used to compute the change in GDP must be adjusted for changes in price.  There are multiple prices indexes for different types of construction listed in the National Income and Product Accounts Handbook, Chapter 6 (pdf), so in lieu of trying to adjust for all of those types of construction separately, we’ve opted to use the producer price index for final demand construction as an inexact shortcut to make the needed price adjustment on the total. That index showed that aggregate construction costs were up 0.4% month over month in October, after increasing 0.1% in August and 0.1% in September… 

On that basis, we can estimate that October construction costs were roughly 0.6% more than those of July, 0.5% more than those of August, and obviously 0.4% more than September. We’ll then use those percentages to inflate higher priced spending figures for each of those months, which is arithmetically the same as deflating October construction spending, for purposes of comparison.  Annualized construction spending in millions of dollars for the third quarter months is given as 1,301,764 in September, 1,305,986 in August, and 1,291,250 in July.   Thus to adjust October’s nominal construction spending of $1,291,069 million for inflation and compare it to that of the third quarter, our arithmetic formula would be: 1,291,069  / (((1,310,806 * 1.019) + ( 1,311,824 *1.020) + (1,317,701 * 1.021)) / 3) = 0.988445, meaning real construction in October was 1.2% lower than that of the 3rd quarter, or down at a 4.54% annual rate.   To figure the effect of that change on GDP,  we figure the difference between the third quarter inflation adjusted average and that of October and take that annualized result of that as a fraction of the inflation adjusted 3rd quarter GDP figure, and find that October construction spending is falling at a rate that would subtract 0.34 percentage points from 4th quarter GDP, assuming hypothetically that there would be no change over the next two months. …

Factory Shipments Down 0.1% in October, Factory Inventories Up 0.1%

The Full Report on Manufacturers’ Shipments, Inventories, & Orders (pdf) for October from the Census Bureau reported that the seasonally adjusted value of new orders for manufactured goods rose by $1.4 billion or 0.3 percent to $497.0 billion in October, following a decrease of 0.8% to $495.574 billion in September, which was revised from the 0.6 percent decrease to $496.7 billion that was reported for September last month….however, since the Census Bureau does not even collect data on new orders for non durable goods for this widely watched “factory orders report”, both the “new orders” and “unfilled orders” sections of this report are really only accurate as revised updates to the October advance report on durable goods we reported on last week…on those durable goods revisions, the Census Bureau’s own summary, which precedes their detailed spreadsheet of the metrics included in this report, is quite clear and complete, so we’ll just quote directly from that summary here:

  • Summary:  New orders for manufactured goods in October, up following two consecutive monthly decreases,  increased $1.4 billion or 0.3 percent to $497.0 billion, the U.S. Census Bureau reported today.  This followed a 0.8 percent September decrease.  Shipments, up following three consecutive monthly  decreases, increased less than $0.1 billion or virtually unchanged to $500.2 billion.  This followed a 0.4  percent September decrease.  Unfilled orders, up three of the last four months, increased $1.0 billion or  0.1 percent to $1,164.3 billion.  This followed a virtually unchanged September decrease.  The unfilled  orders‐to‐shipments ratio was 6.67, down from 6.70 in September.  Inventories, up ten of the last eleven  months, increased $0.9 billion or 0.1 percent to $698.8 billion.  This followed a 0.3 percent September  increase.  The inventories‐to‐shipments ratio was 1.40, unchanged from September.  
  • New orders for manufactured durable goods in October, up four of the last five months, increased $1.3  billion or 0.5 percent to $248.4 billion, down from the previously published 0.6 percent increase.  This  followed a 1.5 percent September decrease.  Transportation equipment, also up four of the last five  months, led the increase, $0.6 billion or 0.7 percent to $84.6 billion.  New orders for manufactured  nondurable goods increased $0.1 billion or virtually unchanged to $248.6 billion. 
  • Shipments of manufactured durable goods in October, down four consecutive months, decreased less than  $0.1 billion or virtually unchanged to $251.6 billion, down from the previously published increase.  This  followed a 0.7 percent September decrease.  Transportation equipment, also down four consecutive  months, drove the decrease, $0.3 billion or 0.4 percent to $83.7 billion.  Shipments of manufactured  nondurable goods, up following two consecutive monthly decreases, increased $0.1 billion or virtually  unchanged to $248.6 billion.  This followed a 0.1 percent September decrease.  Petroleum and coal  products, up three of the last four months, drove the increase, $0.3 billion or 0.7 percent to $51.7 billion.  
  • Unfilled orders for manufactured durable goods in October, up three of the last four months, increased  $1.0 billion or 0.1 percent to $1,164.3 billion, unchanged from the previously published increase.  This  followed a virtually unchanged September decrease.  Transportation equipment, up four consecutive  months, led the increase, $0.9 billion or 0.1 percent to $795.5 billion.  
  • Inventories of manufactured durable goods in October, up fifteen of the last sixteen months, increased  $1.6 billion or 0.4 percent to $432.2 billion, up from the previously published 0.3 percent increase.  This  followed a 0.5 percent September increase.  Transportation equipment, also up fifteen of the last sixteen  months, drove the increase, $1.9 billion or 1.3 percent to $147.4 billion.  Inventories of manufactured  nondurable goods, down seven consecutive months, decreased $0.7 billion or 0.3 percent to $266.6  billion.  This followed a virtually unchanged September decrease.  Food products, down two of the last  three months, led the decrease, $0.4 billion or 0.8 percent to $54.0 billion.  By stage of fabrication,  October materials and supplies increased 0.2 percent in durable goods and were virtually unchanged in  nondurable goods.  Work in process increased 0.8 percent in durable goods and decreased 1.3 percent in  nondurable goods.  Finished goods were virtually unchanged in both durable and nondurable goods.

To estimate the effect of those October factory inventories on 4th quarter GDP, they must first be adjusted for changes in price with appropriate components of the producer price index…by stage of fabrication, the value of finished goods inventories was statistically unchanged at $243,268 million; the value of work in process inventories rose 0.3% to $218,161 million, and materials and supplies inventories were valued 0.1% higher at $237,356 million…the October producer price index reported that prices for finished goods were on average 0.7% higher, that prices for intermediate processed goods were on average 0.4% higher, and that prices for unprocessed goods were 1.0% higher….assuming similar valuations for like types of inventories, those price increases would suggest that October’s real finished goods inventories were about 0.7% lower, that real inventories of intermediate processed goods were 0.1% lower, and that real raw material inventory inventories were about 0.9% lower…since real NIPA factory inventories were grew substantially in the 3rd quarter, the fact that this report indicates a drop in aggregate real October factory inventories will therefore have a correspondingly large negative impact on the growth rate of 4th quarter GDP… 

October Wholesale Sales Down 0.7%, Wholesale Inventories Up 0.1%

The October report on Wholesale Trade, Sales and Inventories (pdf) from the Census Bureau estimated that the seasonally adjusted value of wholesale sales was at “$494.3 billion, down 0.7 percent (±0.5 percent) from the revised September level and were down 1.4 percent (±0.9 percent) from the October 2018 level. The August 2019 to September 2019 percent change was revised from the preliminary estimate of virtually unchanged (±0.5 percent)* to down 0.1 percent (±0.5 percent)*“…as an intermediate activity, wholesale sales are not included in GDP except insofar as they are a trade service, since the traded goods themselves do not represent an increase in the output of the goods produced or finally sold…

On the other hand, the monthly change in private inventories is a major factor in GDP, as additional goods left in a warehouse represent goods that were produced but not sold, and this October report estimated that wholesale inventories were valued at a seasonally adjusted “$675.6 billion at the end of October, up 0.1 percent (±0.4 percent)* from the revised September level. Total inventories were up 3.8 percent (±1.1 percent) from the revised October 2018 level. …they also report that: The September 2019 to October 2019 percent change was revised from the advance estimate of up 0.2 percent (±0.4 percent)* to up 0.1 percent (±0.4 percent)*. in reference to the sketchy Advance Report on Wholesale and Retail Inventories released before the release of 3rd quarter GDP revisions…September’s wholesale inventories were reported down 0.4% at $676.7 billion a month ago, and were revised to down 0.7% at $674,944 million with that advance report, & this report further revises that figure to $674,897 million…

Like factory inventories, to estimate the effect of October wholesale inventories on 4th quarter GDP, we must first adjust them for changes in price with appropriate components of the producer price index…although details are not broken out, we’ve previously estimated that more than 2/3rd of wholesale inventories are finished goods, with notable exceptions such as crude oil and farm product inventories…as we noted earlier, the producer price index for October indicated that prices for finished goods rose 0.7%, prices for intermediate goods intermediate goods rose 0.4%, and prices for unprocessed goods rose 1.0%; hence the 0.1% increase in the nominal value of wholesale inventories masks a decrease of around 0.6% in real terms…since real wholesale inventories in the 3rd quarter were somewhat higher, any decrease in real wholesale inventories in the 4th quarter would thus subtract from the growth of 4th quarter GDP…

 

(the above is the synopsis that accompanied my regular sunday morning links emailing, which in turn was mostly selected from my weekly blog post on the global glass onion…if you’d be interested in receiving my weekly emailing of selected links, most picked from the aforementioned GGO posts, contact me…)      

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oil prices rise most in 23 weeks as OPEC deepens production cuts; horizontal rig activity at a 32 month low…

oil prices finished higher for the fourth time in five weeks after OPEC and other oil producers agreed to a deeper output cuts for the first 3 months of next year…after falling 4.5% to $55.17 a barrel last week on fears that OPEC and Russia would not offer further cuts at this weeks OPEC meeting, the price of light sweet domestic oil for January delivery open higher and jumped more than 2% early Monday on a report that factory activity in China increased for the first time in seven months, and then held most of those gains to close 79 cents higher at $55.96 a barrel on hints that OPEC and its allies might agree to deepen output cuts at their meeting later in the week…oil prices extended their gains on Tuesday on a report that OPEC’s crude output had dropped in November, but the ​day’s increase was limited to 14 cents at $56.10 a barrel after Trump said it might be better to wait until after the 2020 election to complete a trade deal with China…oil prices opened higher again on Wednesday, after an industry report late Tuesday ​had ​pointed to shrinking U.S. crude stockpiles​,​ then surged 4% to close $2.33 higher at $58.43 a barrel after the EIA reported a larger than expected crude draw and Iraq’s oil minister endorsed dramatically higher crude production cuts for OPEC and its non-OPEC alliesoil prices then whipsawed between gains and losses in choppy trade on Thursday as oil traders awaited the OPEC outcome and ended the day unchanged at $58.43 a barrel…oil prices moved higher​ again​ on Friday after OPEC and other producers agreed to deepen oil production cutbacks by 500,000 barrels a day through to March 2020 and went on to close 77 cents, or 1.3%, higher at $59.20 a barrel in its highest settlement since September, and thus ended the week $4.03 or 7.3​% higher than last week​’s close in its biggest one week surge since ​mid-​June….

natural gas prices also finished higher this week, but only modestly so…after falling nearly 16% to an all time contract low of $2.281 per mmBTU on record production and warmer weather last week, the price of natural gas for January delivery rose 4.8 cents Monday and then 11.2 cents more on Tuesday, as a high pressure ridge was ​forecast to form in the west to Alaska​ and thus allow an outbreak of cold to plunge into the nation’s midsection, which was forecast to result in below-average temperatures up and down the East Coast for the next 6-10 days…prices then fell 4.2 cents on Wednesday as traders awaited an expected bearish storage report, but then rallied 2.8 cents on Thursday as the report was consider “neutral”…but natural gas futures fell almost 4% on Friday following the release of weather forecasts calling for less cold over the next two weeks than ​was ​previously expected, ending down 9.3 cents at $2.334 per mmBTU and cutting the price gain for the week down to 2.3%…

the natural gas storage report for the week ending November 29th from the EIA indicated that the quantity of natural gas held in storage in the US decreased by 19 billion cubic feet to 3,591 billion cubic feet by the end of the week, which left our gas supplies 591 billion cubic feet, or 19.7% higher than the 3,000 billion cubic feet that were in storage on November 29th of last year, but still 9 billion cubic feet, or 0.3% below the five-year average of 3,600 billion cubic feet of natural gas that have been in storage as of the 29th of November in recent years….the 19 billion cubic feet that were withdrawn from US natural gas storage this week was a bit less than the average forecast of a 21 billion cubic feet withdrawal by analysts surveyed by S&P Global Platts, and was less than half of the average 41 billion cubic feet of natural gas that have been pulled from natural gas storage during the last week of November over the past 5 years…

The Latest US Oil Supply and Disposition Data from the EIA

US oil data from the US Energy Information Administration for the week ending November 29th indicated that because of a big increase in the amount of oil being used by refineries, we had to pull oil out of our stored commercial supplies for the second time in the past twelve weeks…our imports of crude oil fell by an average of 201,000 barrels per day to an average of 5,989,000 barrels per day, after rising by an average of 217,000 barrels per day during the prior week, while our exports of crude oil fell by an average of 345,000 barrels per day to an average of 3,135,000 barrels per day during the week, which meant that our effective trade in oil worked out to a net import average of 2,854,000 barrels of per day during the week ending November 29th, 144,000 more barrels per day than the net of our imports minus our exports during the prior week…over the same period, the production of crude oil from US wells was reported​ly​ unchanged at a record 12,900,000 barrels per day, ​and thus ​our daily supply of oil from the net of our trade in oil and from well production totaled an average of 15,754,000 barrels per day during this reporting week..

meanwhile, US oil refineries were reportedly processing 16,798,000 barrels of crude per day during the week ending November 29th, 464,000 more barrels per day than the amount of oil they used during the prior week, while over the same period the EIA reported that a net average of 837,000 barrels of oil per day were being pulled out of the supplies of oil stored in the US….hence, this week’s crude oil figures from the EIA appear to indicate that our total working supply of oil from storage. from net imports and from oilfield production was 207,000 barrels per day less than what our oil refineries reported they used during the week….to account for that disparity between the apparent supply of oil and the apparent disposition of it, the EIA inserted a (+207,000) barrel per day figure onto line 13 of the weekly U.S. Petroleum Balance Sheet to make the reported data for the daily supply of oil and the consumption of it balance out, essentially a fudge factor that they label in their footnotes as “unaccounted for crude oil”, thus suggesting an error or errors in the​ oil supply & demand​ figures we just transcribed….(for more on how this weekly oil data is gathered, and the possible reasons for that “unaccounted for” oil, see this EIA explainer)….

further details from the weekly Petroleum Status Report (pdf) indicated that the 4 week average of our oil imports fell to an average of 5,975,000 barrels per day last week, now 21.3% less than the 7,597,000 barrel per day average that we were importing over the same four-week period last year….the 837,000 barrel per day net withdrawal from our total crude inventories included a 694,000 barrel per day ​withdrawal from our commercially available stocks of crude oil, and a withdrawal of 143,000 barrels per day from our Strategic Petroleum Reserve…this week’s crude oil production was reported to be unchanged at a record 12,900,000 barrels per day because the rounded estimate of the output from wells in the lower 48 states was unchanged at a record 12,400,000 barrels per day, while a 8,000 barrel per day decrease to 480,000 barrels per day in Alaska’s oil production was not large enough to impact the final rounded total…last year’s US crude oil production for the week ending November 30th was rounded to 11,700,000 barrels per day, so this reporting week’s rounded oil production figure was 10.3% above that of a year ago, and 53.1% more than the interim low of 8,428,000 barrels per day that US oil production fell to during the last week of June of 2016…   

meanwhile, US oil refineries were operating at 91.9% of their capacity in using 16,798,000 barrels of crude per day during the week ending November 29th, up from 89.3% of capacity the prior week, but still below normal for the last week of November…as a result, the 16,798,000 barrels per day of oil that were refined this week was still 3.9% below the 17,487,000 barrels of crude per day that were being processed during the week ending November 30th, 2018, when US refineries were operating at 95.5% of capacity….

even with the increase in the amount of oil being refined, gasoline output from our refineries was somewhat lower, decreasing by 114,000 barrels per day to 9,941,000 barrels per day during the week ending November 29th, after our refineries’ gasoline output had increased by 12,000 barrels per day the prior week….but even with this week’s decrease in gasoline output, our gasoline production was 2.8% higher than the 9,666,000 barrels of gasoline that were being produced daily over the same week of last year….on the other hand, our refineries’ production of distillate fuels (diesel fuel and heat oil) rose by 188,000 barrels per day to 5,263,000 barrels per day, after our distillates output had decreased by 49,000 barrels per day over the prior week…but even after this week’s increase in distillates output, our distillates’ production for the week was still 5.5% below the 5,571,000 barrels of distillates per day that were being produced during the week ending November 30th, 2018….

even with the decrease in our gasoline production, our supply of gasoline in storage at the end of the week increased for the 4th time in ten weeks and for the 10th time in 24 weeks, rising by 3,385,000 barrels to 229,363,000 barrels during the week to November 29th, after our gasoline supplies had increased by 5,132,000 barrels over the prior week….our gasoline supplies increased by less this week because our imports of gasoline fell by 374,000 barrels per day to 399,000 barrels per day while our exports of gasoline fell by 62,000 barrels per day to 873,000 barrels per day, and while the amount of gasoline supplied to US markets decreased by 72,000 barrels per day to 9,032,000 barrels per day….after this week’s increase, our gasoline supplies were 1.4% higher than last November 30th’s inventory level of 226,250,000 barrels, while remaining roughly 4% above the five year average of our gasoline supplies for this time of the year…

with the increase in our distillates production, our supplies of distillate fuels rose for the 2nd time in 11 weeks and for 12th time in the past 36 weeks, increasing by 3,063,000 barrels to 119,469,000 barrels during the week ending November 29th, after our distillates supplies had increased by 725,000 barrels over the prior week…our distillates supplies rose more this week because the amount of distillates supplied to US markets, an indicator of our domestic demand, fell by 837,000 barrels per day to 3,556,000 barrels per day, ​even as our exports of distillates rose by 596,000 barrels per day to 1,412,000 barrels per day while our imports of distillates fell by 95,000 barrels per day to 143,000 barrels per day…but even after this week’s inventory increase, our distillate supplies were still 4.9% lower than the 125,612,000 barrels of distillates that we had stored on November 30th, 2018, while inching up to 11% below the five year average of distillates stocks for this time of the year…

finally, this week’s big jump in oil refining, combined with a decrease in oil imports, meant our commercial supplies of crude oil in storage fell for the thirteenth time in twenty-five weeks and for the eighteenth time in 45 weeks, decreasing by 4,856,000 barrels, from 451,952,000 barrels on November 22nd to 447,096,000 barrels on November 29th…but even after that decrease, our crude oil inventories remained roughly 3% above the five-year average of crude oil supplies for this time of year, and 34.1% higher than the prior 5 year (2009 – 2013) average of crude oil stocks at the end of November, with the disparity between those comparisons arising because it wasn’t until early 2015 that our oil inventories first rose above 400 million barrels…since our crude oil inventories had generally been rising over this year up until July, after generally falling until then through most of the prior year and a half, our oil supplies as of November 29th were still 0.9% above the 443,162,000 barrels of oil we had stored on November 30th of 2018, but at the same time were fractionally below the 448,103,000 barrels of oil that we had in storage on December 1st of 2017, and 8.0% below the 485,756,000 barrels of oil we had in commercial storage on December 2nd of 2016…     

This Week’s Rig Count

the US rig count fell for the 15th time in 16 weeks and for the 38th time in 42 weeks over the week ending December 6th, and is now down by 26​.2​% since the end of last year….Baker Hughes reported that the total count of rotary rigs running in the US fell by 3 rigs to a 32 month low of 799 rigs this past week, which was also down by 276 rigs from the 1075 rigs that were in use as of the December 7th report of 2018, and 1127 fewer rigs than the shale era high of 1929 drilling rigs that were deployed on November 21st of 2014, the week before OPEC began their attempt to flood the global oil market…

the number of rigs drilling for oil decreased by 5 rigs to a 32 month low of 663 oil rigs this week, which was also 214 fewer oil rigs than were running a year ago, and well below the recent high of 1609 rigs that were drilling for oil on October 10th, 2014…at the same time, the number of drilling rigs targeting natural gas bearing formations increased by 2 rigs to 133 natural gas rigs, which was still down by 65 gas rigs from the 198 natural gas rigs that were drilling a year ago, and way down from the modern era high of 1,606 rigs targeting natural gas that were deployed on September 7th, 2008…in addition to those drilling for oil & gas, three rigs classified as ‘miscellaneous’ continued to drill this week; one on the big island of Hawaii, one in Washoe County, Nevada, and one in Lake County, California, in contrast to a year ago, when there were no such “miscellaneous” rigs deployed..

offshore drilling activity in the Gulf of Mexico was unchanged at 22 rigs this week, with all 22 of those drilling offshore from Louisiana…that was down by one from the Gulf of Mexico rig count of 23 a year ago, when 22 rigs were drilling in Louisiana waters and one was drilling offshore from Texas…since there are no rigs deployed off US shores elsewhere, nor were there a year ago, the Gulf of Mexico count for both years is equal to the national total in each case..

the count of active horizontal drilling rigs was down by 6 rigs to 695 horizontal rigs this week, which was the least horizontal rigs deployed since April 7th 2017 and hence was a 32 month low for horizontal drilling…it was also 238 fewer horizontal rigs than the 933 horizontal rigs that were in use in the US on December 7th of last year, and also well down from the record of 1372 horizontal rigs that were deployed on November 21st of 2014….at the same time, the directional rig count was down by 1 to 52 directional rigs this week, and those were down by 20 from the 72 directional rigs that were operating during the same week of last year….on the other hand, the vertical rig count was up by 4 to 52 vertical rigs this week, but those were still down by 18 from the 70 vertical rigs that were in use on December 7th of 2018…

the details on this week’s changes in drilling activity by state and by major shale basin are shown in our screenshot below of that part of the rig count summary pdf from Baker Hughes that gives us those changes…the first table below shows weekly and year over year rig count changes for the major oil & gas producing states, and the table below that shows the weekly and year over year rig count changes for the major US geological oil and gas basins…in both tables, the first column shows the active rig count as of December 6th, the second column shows the change in the number of working rigs between last week’s count (November 29th) and this week’s (December 6th) count, the third column shows last week’s November 29th active rig count, the 4th column shows the change between the number of rigs running on Friday and the number running before the same weekend of a year ago, and the 5th column shows the number of rigs that were drilling at the end of that reporting week a year ago, which in this week’s case was the 7th of December, 2018…  

December 6th 2019 rig count summary

as you can see, this week’s rig changes were concentrated in the Permian basin of western Texas, where we find that four rigs were pulled out of Texas Oil District 8, or the core Permian Delaware, and two rigs were shut down in Texas Oil District 8A, or from the northern Permian Midland, while a rig began operating in Texas Oil District 7C, or the southern part of the Permian Midland…meanwhile, the new rig that was added in the panhandle area Granite Wash ​basin ​appears to have been set up on the Oklahoma side of the state line, since the rig count in Texas Oil District 10 was unchanged, and hence that balances Oklahoma’s total after two rigs were pulled out of the Cana Woodford…among rigs drilling for natural gas, two were pulled out of the Haynesville shale; one of which had been operating in northwest Louisiana, and the other in adjacent eastern Texas (Oil District 6), while a natural gas rig was added in Pennsylvania’s Marcellus and three more natural ga​s ​rigs were added in basins not tracked separately by Baker Hughes…one of those could have been in Mississippi, which also added a rig this week and now has 4 rigs operating…while that’s still down from the 5 rigs that were operating in Mississippi a year ago, the rig count in that state has been quite volatile, ranging from 1 to 6 rigs over the past year..

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table for December 7th

rig count summary:

December 6th 2019 rig count summary

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natural gas prices for January at an all time low; natural gas & oil production both at all time highs

oil prices fell for the first time in four weeks as a report that the Saudis would pressure other OPEC members to carry their own weight at next week’s OPEC meeting precipitated a 5% drop on Fridayafter closing little changed last week at $57.77 a barrel on conflicting stories on US-China trade, oil inventories, and OPEC, the price of light sweet domestic oil for January delivery started this week higher on new optimism that the US and China would soon sign a deal to end their trade war, and finished Monday up 24 cents at $58.01 a barrel…hopes of progress towards a trade agreement and hopes for an OPEC+ production cut extension pushed prices another 40 cents higher to $58.41 a barrel on Tuesday, even as prices backed backed off before reaching last Thursday’s two month high…oil prices then slumped after the American Petroleum Institute (API) reported a crude oil inventory increase much greater than was expected, but came back near the close on Wednesday to end down 30 cents at $58.11 a barrel, as losses were limited by optimism that a U.S.-China trade deal would soon be reachedUS oil again traded lower on Thursday in Asia, reacting to the EIA report that oil crude inventories unexpectedly rose last week and ended down 33 cents, or 0.6%, to $57.78 a barrel in overseas trading after Trump signed into law a bipartisan bill backing protesters in Hong Kong, fueling new tensions with China…oil prices then fell sharply in US markets on Friday on rising US-China tensions over Hong Kong and on the resignation of the Iraqi Prime Minister, which traders believed would help quell weeks of unrest in Iraq, and went on to finish $2.94 or 5.1% lower at $55.17 a barrel following reports the Saudis would no longer compensate for excessive production by other OPEC members, and on comments by the Russian Energy Minister that he would prefer if OPEC and other producers delayed the decision on whether to extend their production cuts till April…oil prices thus ended the week 4.5% lower than the prior week’s close, but still managed to log an increase of 2.3% for November, their largest monthly gain since June

meanwhile, natural gas prices fell nearly 16% to an all time low as warmer weather and record high gas production sent prices tumbling…after recovering to lose less than 1% last week at $2.665 per mmBTU, the contract price of natural gas for December delivery fell 13.4 cents on Monday and 6.1 cents on Tuesday, as weekend natural gas production was at a record high while weather models changed from indicating much below normal temperatures over the entire country to just a modest cooling in the East…with trading in the December contract rolling off the boards at $2.470 per mmBTU on Tuesday, the contract price of natural gas for January delivery, which had ended the prior week at $2.710 per mmBTU, fell another 3.2 cents to $2.501 per mmBTU on Wednesday, and then fell 22 cents to an all time low of $2.281 per mmBTU on Friday as the outlook for the second week of December turned warmer, with temperatures expected to be above normal across most of the contiguous U.S.

with natural gas prices for delivery in January thus closing at an all time low, we’ll bring up a few price graphs to see what they look like, and what the implications of that record low price might be….the first graph we have here shows the daily price of the January 2020 natural gas contract over the past 6 months…

November 30 2019 daily natural gas prices

the above graph is a screenshot of the interactive daily price of the January natural gas contract at Barchart.com, “the leading provider of real-time or delayed intraday stock and commodities charts and quotes”, and it shows the range of prices, in dollars per mmBTU, for that January natural gas contract as a vertical bar for each day over the past 6 months…you might note that each bar has two small horizontal appendages: the one on the left is the opening price for that day, while the appendage on the right is the day’s closing price…what we can see here is that up until Friday of this week, this contract had seldom sold for less than $2.50 per mmBTU, and then on Friday it crashed 22 cents to $2.281 per mmBTU, 20 cents lower than it had ever been priced for previously…we should make clear that this graph shows the price of the January contract, which is historically the most expensive, and that mid-summer gas contract prices we have quoted earlier this year were often lower priced…

to extend that price picture out a bit, we’ll also include a graph of weekly price of the January natural gas contract over the past year…the format is the same as the graph above, but in this case each bar represents the price range of the January 2020 contract over each of the past 52 weeks…again, the magnitude of this week’s price drop compared to other weekly changes stands out..

November 30 2019 weekly natural gas prices

lastly, to give us a long term historical view, we’ll include a version of that graph that shows the price range of the January 2020 natural gas contract for each quarter over the past 11 years…:hence, the entirety of what we saw on the daily graph is represented by just the two rightmost bars on this graph, which should give you a good sense of how long natural gas prices have been falling, and how far they have fallen….again, remember this is the graph for the January 2020 futures contract; daily spot prices and the widely quoted front month contract price have been much more volatile over time than the price that a commodity such as natural gas would trade for on a contract that references delivery 5 or 10 years from the date that it’s being traded…ie, while futures prices were toying with $9 per mmBTU ten years ago, the then current contract prices topped $12..

November 30 2019 quarterly natural gas prices

these prices represent what a natural gas exploitation company could have locked in to sell their gas in January 2020 at any time over the past 11 years, or the price that a utility could have locked in their purchase of gas over the same period, although in practice, producers and users of gas seldom lock in contract prices that far out…there are similar futures contracts for each month of each year going out at least 5 years (ie, here’s natural gas contract prices for February 2024) and then for the beginning month of each quarter going out at least 20 years…while this isn’t the lowest price a natural gas contract has traded for, it is the lowest that natural gas contracted for January has ever been priced at…and since futures contract prices farther out generally moved in tandem; ie, natural gas contracted for July 2020 delivery, for instance, fell 11.1 cents on Friday to $2.250 per mmBTU, this week’s price move suggests that anyone planning to drill this summer will have a hard time securing a price that will enable profitability..

the natural gas storage report for the week ending November 22nd from the EIA indicated that the quantity of natural gas held in storage in the US decreased by 28 billion cubic feet to 3,610 billion cubic feet by the end of the week, which left our gas supplies 548 billion cubic feet, or 17.9% higher than the 3,062 billion cubic feet that were in storage on November 22nd of last year, but still left our supplies 31 billion cubic feet, or 0.9% below the five-year average of 3,641 billion cubic feet of natural gas that have been in storage as of the 22nd of November in recent years….the 28 billion cubic feet that were withdrawn from US natural gas storage this week was 3 billion cubic feet more than the average forecast of a 25 billion cubic feet withdrawal by analysts surveyed by S&P Global Platts, but was quite a bit less than the average 57 billion cubic feet of natural gas that have been pulled from natural gas storage during the third week of November over the past 5 years, which thus suggests that my theory that we may have entered a new normal where both injections and withdrawals would be greater than their previous norms was only a one week wonder…

The Latest US Oil Supply and Disposition Data from the EIA

US oil data from the US Energy Information Administration for the week ending November 22nd showed that because of increases in our oil imports and oil production, as well as another large draw from the Strategic Petroleum Reserve, we again managed to have a small surplus of oil available to be added to our stored commercial supplies for the tenth time in the past eleven weeks…our imports of crude oil rose by an average of 217,000 barrels per day to an average of 6,190,000 barrels per day, after rising by an average of 222,000 barrels per day during the prior week, while our exports of crude oil rose by an average of 453,000 barrels per day to an average of 3,480,000 barrels per day during the week, which meant that our effective trade in oil worked out to a net import average of 2,710,000 barrels of per day during the week ending November 22nd, 236,000 fewer barrels per day than the net of our imports minus our exports during the prior week…over the same period, the production of crude oil from US wells was reported to be 100,000 barrels per day higher at a record 12,900,000 barrels per day, so our daily supply of oil from the net of our trade in oil and from well production totaled an average of 15,610,000 barrels per day during this reporting week..

meanwhile, US oil refineries were reportedly processing 16,334,000 barrels of crude per day during the week ending November 22nd, 101,000 fewer barrels per day than the amount of oil they used during the prior week, while over the same period the EIA reported that a net average of 29,000 barrels of oil per day were being added to the supplies of oil stored in the US….hence, this week’s crude oil figures from the EIA appear to indicate that our total working supply of oil from net imports and from oilfield production was 753,000 barrels per day less than what was added to storage plus what our oil refineries reported they used during the week….to account for that disparity between the apparent supply of oil and the apparent disposition of it, the EIA inserted a (+753,000) barrel per day figure onto line 13 of the weekly U.S. Petroleum Balance Sheet to make the reported data for the daily supply of oil and the consumption of it balance out, essentially a fudge factor that they label in their footnotes as “unaccounted for crude oil”….with that much oil unaccounted for again this week, it means that one or all of the oil metrics that the EIA has reported and that we have just transcribed must necessarily be seriously off the mark…however, since the media treats these figures as gospel and since they drive oil pricing and hence decisions to drill for oil, we continue to report them just as they’re seen & believed by everyone else, since commonly held illusions always top reality (for more on how this weekly oil data is gathered, and the possible reasons for that “unaccounted for” oil, see this EIA explainer)….

further details from the weekly Petroleum Status Report (pdf) indicated that the 4 week average of our oil imports fell to an average of 5,997,000 barrels per day last week, now 21.9% less than the 7,677,000 barrel per day average that we were importing over the same four-week period last year….the 29,000 barrel per day net addition our total crude inventories included a 224,000 barrel per day addition to our commercially available stocks of crude oil, which was mostly offset by a withdrawal of 195,000 barrels per day from our Strategic Petroleum Reserve…this week’s crude oil production was reported to be 100,000 barrels per day higher at a record 12,900,000 barrels per day because the rounded estimate of the output from wells in the lower 48 states was 100,000 barrels per day higher at a record 12,400,000 barrels per day, while a 7,000 barrel per day increase to 488,000 barrels per day in Alaska’s oil production was not large enough to impact the final rounded total…last year’s US crude oil production for the week ending November 23rd was rounded to 11,700,000 barrels per day, so this reporting week’s rounded oil production figure was 10.3% above that of a year ago, and 53.1% more than the interim low of 8,428,000 barrels per day that US oil production fell to during the last week of June of 2016…   

meanwhile, US oil refineries were operating at 89.3% of their capacity in using 16,334,000 barrels of crude per day during the week ending November 22nd, down from 89.5% of capacity the prior week, and below normal for the third week of November…as a result, the 16,334,000 barrels per day of oil that were refined this week was 6.9% below the 16,855,000 barrels of crude per day that were being processed during the week ending November 23rd, 2018, when US refineries were operating at 95.6% of capacity….

even with a modest decrease in the amount of oil being refined, gasoline output from our refineries was a bit higher, increasing by 12,000 barrels per day to 10,065,000 barrels per day during the week ending November 22nd, after our refineries’ gasoline output had decreased by 120,000 barrels per day the prior week….but even with this week’s increase in gasoline output, our gasoline production was still 1.0% lower than the 10,186,000 barrels of gasoline that were being produced daily over the same week of last year….on the other hand, our refineries’ production of distillate fuels (diesel fuel and heat oil) fell by 49,000 barrels per day to 5,075,000 barrels per day, after our distillates output had increased by 85,000 barrels per day over the prior week…after this week’s decrease in distillates output, our distillates’ production for the week was 7.2% below the 5,471,000 barrels of distillates per day that were being produced during the week ending November 23rd, 2018….

with the increase in our gasoline production, our supply of gasoline in storage at the end of the week increased for the 3rd time in nine weeks and for the 9th time in 23 weeks, rising by 5,132,000 barrels to 225,978,000 barrels during the week to November 22nd, after our gasoline supplies had increased by 1,756,000 barrels over the prior week….our gasoline supplies increased by more this week because our imports of gasoline rose by 258,000 barrels per day to 773,000 barrels per day while our exports of gasoline rose by 46,000 barrels per day to 935,000 barrels per day, and while the amount of gasoline supplied to US markets increased by 12,000 barrels per day to 9,204,000 barrels per day….after this week’s increase, our gasoline supplies were 0.6% higher than last November 23rd’s inventory level of 224,551,000 barrels, and rose to roughly 4% above the five year average of our gasoline supplies for this time of the year…

however, even with the decrease in our distillates production, our supplies of distillate fuels rose for the 1st time in 10 weeks and for 11th time in the past 35 weeks, increasing by 725,000 barrels to 116,406,000 barrels during the week ending November 22nd, after our distillates supplies had decreased by 974,000 barrels over the prior week…our distillates supplies rose this week because our exports of distillates fell by 439,000 barrels per day to 816,000 barrels per day while our imports of distillates fell by 77,000 barrels per day to 238,000 barrels per day, and while the amount of distillates supplied to US markets, an indicator of our domestic demand, increased by 70,000 barrels per day to 4,393,000 barrels per day….but even after this week’s inventory increase, our distillate supplies were still 4.4% lower than the 121,801,000 barrels of distillates that we had stored on November 23rd, 2018, and fell to around 12% below the five year average of distillates stocks for this time of the year…

finally, despite this week’s increase in oil exports, the oil we pulled out of the SPR meant our commercial supplies of crude oil in storage rose for the twelfth time in twenty-four weeks and for the twenty-seventh time in 44 weeks, increasing by 1,379,000 barrels, from 450,380,000 barrels on November 15th to 451,952,000 barrels on November 22nd…after that increase, our crude oil inventories were roughly 3% above the five-year average of crude oil supplies for this time of year, and almost 35% higher than the prior 5 year (2009 – 2013) average of crude oil stocks after three weeks of November, with the disparity between those comparisons arising because it wasn’t until early 2015 that our oil inventories first rose above 400 million barrels…since our crude oil inventories had generally been rising over this year up until July, after generally falling until then through most of the prior year and a half, our oil supplies as of November 22nd were still 0.3% above the 450,485,000 barrels of oil we had stored on November 23rd of 2018, but at the same time were 0.4% below the 453,713,000 barrels of oil that we had in storage on November 24th of 2017, and 7.4% below the 488,145,000 barrels of oil we had in commercial storage on November 25th of 2016…    

This Week’s Rig Count

the US rig count fell for the 14th time in 15 weeks and for the 37th time in 41 weeks over the week ending November 29th, and is now down by 26% since the end of last year….Baker Hughes reported that the total count of rotary rigs running in the US fell by 1 rig to a 32 month low of 802 rigs this past week, which was also down by 274 rigs from the 1076 rigs that were in use as of the November 30th report of 2018, and 1127 fewer rigs than the shale era high of 1929 drilling rigs that were deployed on November 21st of 2014, the week before OPEC began their attempt to flood the global oil market…

the number of rigs drilling for oil decreased by 3 to a 31 month low of 668 oil rigs this week, which was also 219 fewer oil rigs than were running a year ago, and well below the recent high of 1609 rigs that were drilling for oil on October 10th, 2014…at the same time, the number of drilling rigs targeting natural gas bearing formations increased by 2 rigs to 131 natural gas rigs, which was ​still ​down by 58 rigs from the 189 natural gas rigs that were drilling a year ago, and way down from the modern era high of 1,606 rigs targeting natural gas that were deployed on September 7th, 2008…in addition to those drilling for oil & gas, three rigs classified as ‘miscellaneous’  continued to drill this week; one on the big island of Hawaii, one in Washoe County, Nevada, and one in Lake County, California, in contrast to a year ago, when there were no such “miscellaneous” rigs deployed..

offshore drilling activity in the Gulf of Mexico was unchanged at 22 rigs this week, with all 22 of those drilling offshore from Louisiana…but that’s down by one from the Gulf of Mexico rig count of 23 a year ago, when 22 rigs were drilling in Louisiana waters and one was drilling offshore from Texas…since there are no rigs deployed off US shores elsewhere, nor were there a year ago, the Gulf of Mexico count for both years is equal to the national total in each case..

the count of active horizontal drilling rigs was up by 2 rigs to 701 horizontal rigs this week, which was still 233 fewer horizontal rigs than the 934 horizontal rigs that were in use in the US on November 30th of last year, and also well down from the record of 1372 horizontal rigs that were deployed on November 21st of 2014…..on the other hand, the vertical rig count was down by 2 to 48 vertical rigs this week, and those were down by 26 from the 74 vertical rigs that were operating during the same week of last year…at the same time, the directional rig count was down by 1 to 53 directional rigs this week, and those were down by 15 from the 68 directional rigs that were in use on November 30th of 2018…

the details on this week’s changes in drilling activity by state and by major shale basin are shown in our screenshot below of that part of the rig count summary pdf from Baker Hughes that gives us those changes…the first table below shows weekly and year over year rig count changes for the major oil & gas producing states, and the table below that shows the weekly and year over year rig count changes for the major US geological oil and gas basins…in both tables, the first column shows the active rig count as of November 29th, the second column shows the change in the number of working rigs between last week’s count (November 22nd) and this week’s (November 29th) count, the third column shows last week’s November 22nd active rig count, the 4th column shows the change between the number of rigs running on Friday and the number running before the same weekend of a year ago, and the 5th column shows the number of rigs that were drilling at the end of that reporting week a year ago, which in this week’s case was the 30th of November, 2018…  

November 29 2019 rig count summary

even though the Permian basin shows no change this week, there was a rig added in Texas Oil District 8, or the core Permian Delaware, while at the same time, a rig was shut down in Texas Oil District 8A, or the northern Permian Midland…since there are no other changes in Texas oil districts that could possibly indicate another Permian change, it’s apparent that the rig that was pulled out of New Mexico was operating in an “other” basin in the state, such as the fairly active San Juan Basin in the northwest corner of the state…the two rigs that were pulled out of north-central Texas’s Barnett shale were both oil rigs; the two that remain are drilling for natural gas…in addition, an oil rig was pulled out of the Denver-Julesburg NIobrara chalk in Colorado, while the oil rig pulled ​out of the Mississippian​ shale​ came out of Oklahoma, since there haven’t been any Mississippian rigs operating in Kansas for quite a while…meanwhile, the increase of 2 rigs targeting natural gas included one added in the Eagle Ford of southeast Texas, which now has 6 natural gas rigs, as an oil rig in that basin was shut down at the same time, and the rig that was added in Texas Oil District 8, or the core Permian Delaware, which is the first natural gas drilling in the Permian since early August 2018….we should also note that a rig started drilling in Nebraska this week, in the first Nebraska activity since April….all 4 Nebraska rig startups since mid-2016 have only lasted a week each time, which is quite unusual…

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3rd quarter GDP revision, October’s income and outlays, durable goods, and new home sales

The key economic reports released over the past week were the 2nd estimate of 3rd quarter GDP and the October report on Personal Income and Spending, both from the Bureau of Economic Analysis; other widely watched releases included the Advance Report on Durable Goods for October and the October report on new home sales, both from the Census bureau, and the Case-Shiller Home Price Index for September from S&P Case-Shiller, an index generated by averaging relative home sales prices from July, August and September of this year against a January 2000 baseline…they reported that home prices nationally for those 3 months averaged 3.2% higher than prices for the same homes that sold during the same 3 month period a year earlier, up from the 3.1% year over year index increase shown in the prior report…

The week also saw the release of the Chicago Fed National Activity Index (CFNAI) for October, a weighted composite index of 85 different economic metrics, which fell to –0.71 in October from –0.45 in September, which was revised but unchanged from last month….as a result, the 3 month average of the CFNAI fell to -0.31 in October, down from a revised -0.21 in September, which indicates that national economic activity has been somewhat below the historical trend over those recent months….

In addition, the week brought us the last two regional Fed manufacturing surveys for November; the Richmond Fed Survey of Manufacturing Activity for November, covering an area that includes Virginia, Maryland, the Carolinas, the District of Columbia and West Virginia, reported its broadest composite index fell to -1 in November, down from +8 in October, suggesting stagnation of that region’s manufacturing, while the Dallas Fed Texas Manufacturing Outlook Survey reported its general business activity index rose to -1.3 in November from -5.1 in October, indicative of a moderation of the ongoing slump in the Texas area economy…

3rd Quarter GDP Grew at a 2.1% Rate, Revised from 1.9%

The Second Estimate of our 3rd Quarter GDP from the Bureau of Economic Analysis indicated that our real output of goods and services grew at a 2.1% rate in the quarter, revised from the 1.9% growth rate reported in the advance estimate a month ago, as fixed investment shrunk by less than was previously reported and inventory investment grew more than was previously estimated, which more than offset a smaller downward revision to government consumption expenditures and gross investment and an upward revision to imports….in current dollars, our third quarter GDP grew at a 3.84% annual rate, increasing from what would work out to be a $21,340.3 billion a year output rate in the 2nd quarter to a $21,542.1 billion annual rate in the 3rd quarter, with the headline 2.1% annualized rate of increase in real output arrived at after annualized inflation adjustments averaging 1.8%, aka the GDP deflator, was computed and applied to the current dollar change of each of the GDP components….

Remember that the GDP release reports all quarter over quarter percentage changes at an annual rate, which means that they’re expressed as a change a bit over 4 times of that what actually occurred over the 3 month period, and that the prefix “real” is used to indicate that each change has been adjusted for inflation using price changes chained from 2012, and then that all percentage changes in this report are calculated from those 2012 dollar figures, which would be better thought of as a quantity indexes than as any reality based dollar amounts….for our purposes, all the data that we’ll use in reporting the changes here comes directly from the pdf for the 3rd estimate of 3rd quarter GDP, which we find on the BEA GDP landing page, which also offers links to just the tables on Excel and other technical notes…specifically, we reference table 1, which shows the real percentage change in each of the GDP components annually and quarterly since the 4th quarter of 2015; table 2, which shows the contribution of each of the components to the GDP figures for those quarters and years; table 3, which shows both the current dollar value and inflation adjusted value of each of the GDP components; and table 4, which shows the change in the price indexes for each of the components…the pdf for the 3rd quarter advance estimate, which this estimate revises, is here

Growth of real personal consumption expenditures (PCE), the largest component of GDP, was revised but remained at an overall 2.9% rate in this 2nd estimate…that growth rate figure was arrived at by deflating the 4.44% growth rate in the dollar amount of consumer spending with the PCE price index, which indicated inflation grew at a 1.5% annual rate in the 3rd quarter, which was unrevised from the PCE inflation rate reported a month ago…real consumption of durable goods grew at a 8.3% annual rate, which was revised from the 7.6% growth rate shown in the advance report, and added 0.57 percentage points to GDP, as consumption of recreational goods and vehicles grew at a 11.8% rate and accounted for over 60% of the durable goods increase….real consumption of nondurable goods by individuals grew at a 4.3% annual rate, revised from the 4.4% growth rate reported in the 1st estimate, and added 0.59 percentage points to the 3rd quarter’s economic growth rate, as a 5.5% growth in real consumption of food and beverages accounted for more than 45% of the growth in non-durables….at the same time, consumption of services rose at a 1.7% annual rate, unrevised from the growth rate reported last month, and added 0.80 percentage points to the final GDP tally, as growth in health care, housing and utilities, and food services and accommodations all made major contributions to the quarter’s growth in services…

Meanwhile, seasonally adjusted real gross private domestic investment shrunk at a 0.1% annual rate in the 3rd quarter, revised from the original 1.5% contraction estimate reported last month, as real private fixed investment shrunk at a 1.0% rate, revised from the 1.3% contraction rate reported in the advance estimate, while inventory growth was greater than previously estimated…investment in non-residential structures was revised to show contraction at a 12.0% rate, not as bad as the 15.7% contraction rate previously reported, and real investment in equipment contracted at an unrevised 3.8% rate, while the quarter’s investment in intellectual property products was revised from growth at a 6.6% rate to growth at a 5.1% rate, while at the same time real residential investment was also shown to be growing at a 5.1% annual rate, unrevised from the previous report…after those revisions, the decrease in investment in non-residential structures subtracted 0.37 percentage points from the 3rd quarter’s growth rate and the decrease in investment in equipment subtracted 0.22 percentage points from the quarter’s growth rate, while growth in investment in intellectual property added 0.24 percentage points to the growth rate of 3rd quarter GDP and growth in residential investment added 0.18 percentage points to the growth of GDP…

In addition, investment in real private inventories grew by an inflation adjusted $79.8 billion in the 3rd quarter, revised from the originally reported $69.0 billion of real inventory growth…this came after inventories had grown at an inflation adjusted $69.4 billion rate in the 2nd quarter, and hence the $10.4 billion increase in real inventory growth added 0.17 percentage points to the quarter’s growth rate, revised from the 0.05 percentage point subtraction from GDP due to lower inventory growth that was indicated in the advance estimate…. however, since growth in inventories indicates that more of the goods produced during the quarter were left in warehouses or “sitting on the shelf”, their quarter over quarter increase at a $10.4 billion rate meant that growth of real final sales of GDP was relatively smaller by that much, and hence real final sales of GDP rose at a 2.0% rate in the 3rd quarter, down from the real final sales growth rate of 3.0% in the 2nd quarter, when a decrease in inventory growth meant that growth in real final sales of domestic product was greater than the real growth in GDP…

The previously reported increase in real exports was revised a bit higher with this estimate, but the previously reported increase in real imports was revised upwards by more, and as a result the change in our net trade was a greater subtraction from GDP rather than was previously reported…our real exports grew at a 0.9% rate rather than the 0.7% rate reported in the first estimate, and since exports are added to GDP because they are part of our production that was not consumed or added to investment in our country, that growth added 0.11 percentage points to the 3rd quarter’s growth rate, revised from the 0.09 percentage point addition shown in the previous report….meanwhile, the previously reported 1.2% increase in our real imports was revised to a 1.5% increase, and since imports are subtracted from GDP because they represent either consumption or investment added to an other GDP component that was not produced here, their increase subtracted 0.22 percentage points to 3rd quarter GDP, rather than the 0.17 percentage point subtraction shown last month….thus, our deteriorating trade balance subtracted a net of 0.11 percentage points from 3rd quarter GDP, rather than the 0.08 percentage point subtraction that had been indicated by the advance estimate..

Finally, the entire government sector grew at a 1.6% rate, revised from the 2.0% growth rate previously reported, as federal government consumption and investment was little changed from the initial estimate, while real state & local government consumption and investment grew somewhat slower than had been previously indicated….real federal government consumption and investment was seen to have grown at a 3.4% rate from the 2nd quarter in this estimate, statistically unrevised from the growth rate shown in the advance estimate, as real federal outlays for defense grew at an unrevised 2.2% rate and added 0.09 percentage points to 3rd quarter GDP, while all other federal consumption and investment grew at an 5.1% rate, revised from the 5.2% growth rate shown previously, and added 0.13 percentage points to 3rd quarter GDP….meanwhile, real state and local consumption and investment grew at a 0.5% rate in the quarter, which was revised from the 1.1% growth rate reported in the 1st estimate, and added 0.06 more percentage points to 3rd quarter GDP, after a decrease in real state and local investment at a 1.3% rate subtracted 0.09 percentage points from the increase…..note that government outlays for social insurance are not included in this GDP component; rather, they are included within personal consumption expenditures only when such funds are spent on goods or services, indicating an increase in the output of those goods or services…

Personal Income Unchanged in October, Personal Spending up 0.3%, PCE Price Index up 0.2%

The October report on Personal Income and Outlays from the Bureau of Economic Analysis includes the month’s data for our personal consumption expenditures (PCE), which accounts almost 70% of the month’s GDP, and with it the PCE price index, the inflation gauge the Fed targets, and which is used to adjust that personal spending data for inflation to give us the relative change in the output of goods and services that our spending indicated…in addition, this release reports our personal income data, disposable personal income, which is income after taxes, and our monthly savings rate…however, because this report feeds in to GDP and other national accounts data, the change reported for each of those metrics is not the current monthly change; rather, they’re seasonally adjusted amounts expressed at an annual rate, ie, they tell us how much income and spending would change over a year if October’s change in seasonally adjusted income and spending were extrapolated over an entire year…however, the percentage changes are computed monthly, from one month’s annualized figure to the next, and in this case of this month’s report they give us the percentage change in each annualized metric from September to October….

Thus, when the opening line of the news release for this report tell us “Personal income increased $3.3 billion (less than 0.1 percent) in October“, they mean that the annualized figure for seasonally adjusted personal income in October, $18,794.4 billion, was $3.3 billion higher, or virtually unchanged from the annualized personal income figure of $18,791.1 billion extrapolated for September; the actual, unadjusted change in personal income from September to October is not given…at the same time, annualized disposable personal income, which is income after taxes, actually fell by three-quarters of 0.1%, from an annual rate of $16,604.7 billion in September to an annual rate of $16,592.1 billion in October…the monthly contributors to the change in personal income, which can be viewed in detail in the Full Release & Tables (PDF) for this release, are also annualized…in October, there was only a $3.3 billion annual rate of increase in personal income because the $33.8 billion annual rate of increase in income from wages and salaries was mostly offset by a $29.6 billion annual rate of decrease in interest and dividend income…

For the personal consumption expenditures (PCE) that we’re most interested in, BEA reports that they increased at a $39.7 billion rate, or by almost 0.3%, as the annual rate of PCE rose from $14,702.4 billion in September to $14,742.1 billion in October….September PCE was revised from $14,696.2 billion annually to $14,702.4 billion, a revision that was already incorporated into the 2nd estimate of 3rd quarter GDP which we just reviewed (this report, although usually released a business day later than the GDP release, is computed concurrently)….total personal outlays, which includes interest payments and personal transfer payments in addition to PCE, rose by an annualized $43.1 billion to $15,305.2 billion annually in October, which left total personal savings, which is disposable personal income less total outlays, at a $1,286.9 billion annual rate in October, down from the revised $1,342.6 billion annualized personal savings in September… as a result, the personal saving rate, which is personal savings as a percentage of disposable personal income, fell to 7.8% in October from the revised September savings rate of 8.1%…

As you know, before personal consumption expenditures are used in the computation of GDP, they must first be adjusted for inflation to give us the real change in consumption, and hence the real change in goods and services that were produced for that consumption….that’s done with the price index for personal consumption expenditures, which is a chained price index based on 2012 prices = 100, which is included in Table 9 in the pdf for this report…that index was at 110.133 in October, up from 109.928 in September, giving us a PCE price index change and inflation adjustment of 0.18649% in October, which the BEA rounded to +0.2% for the press release…note that when the PCE price indexes are applied to a given month’s annualized PCE in current dollars, it yields that month’s annualized real PCE in those chained 2012 dollars, which are the means that the BEA uses to compare one month’s or one quarter’s real goods and services produced to that of another….that result is shown in table 7 of the PDF, where we see that October’s chained dollar consumption total works out to 13,386.3  billion annually, 0.08374% more than September’s 13,375.1 billion, a difference that the BEA reports as +0.1%…

However, to estimate the impact of the change in October PCE on the change in GDP, the month over month change in PCE doesn’t help us much, since GDP is reported quarterly…thus we have to compare October’s real PCE to the real PCE of the 3 months of the third quarter….while this report shows PCE for all those amounts monthly, the BEA also provides the quarterly annualized chained dollar PCE for those three months in table 8 of the pdf for this report, where we find that the annualized real PCE for the 3rd quarter was represented by 13,345.6 billion in chained 2012 dollars..(note that’s the same as what’s shown in table 3 of the pdf for the 3rd quarter GDP report)….when we compare October’s real PCE representation of 13,386.3 billion to the 3rd quarter real PCE figure of 13,345.6 billion, we find that October’s real PCE has grown at a 1.225% annual rate from that of the 3rd quarter….that would mean that even if October real PCE does not improve during November and December, growth in PCE would still add 0.85 percentage points to the GDP growth rate of the 4th quarter…

October Durable Goods: New Orders Up 0.6%, Shipments Unchanged, Inventories Up 0.3%

The Advance Report on Durable Goods Manufacturers’ Shipments, Inventories and Orders for October (pdf) from the Census Bureau reported that the value of the widely followed new orders for manufactured durable goods increased by $1.5 billion or 0.6 percent to $248.7 billion in October, after September’s new orders were revised from the $248.2 billion reported last month to $247.3 billion, now a 1.4% decrease from August, rather than the 1.1% decrease previously reported…year to date new orders are still 0.8% below those of 2018, the same year over year decrease we saw in this report last month….a $0.6 billion or 1.8 percent to $34.1 billion in new orders for fabricated metal products led the increase, while the volatile monthly change in new orders for transportation equipment rose $0.5 billion or 0.7 percent to $84.6 billion, as a 10.7% increase to $8,122 million in new orders for commercial aircraft more than offset a 1.7% decrease to $11,657 million in new orders for motor vehicles and parts….excluding orders for transportation equipment, other new orders rose 0.6%, while excluding just new orders for defense equipment, new orders rose 0.1%….meanwhile, new orders for nondefense capital goods less aircraft, a proxy for equipment investment, rose by $807 million or 1.2% to $69,369 million…

At the same time, the seasonally adjusted value of October shipments of durable goods, which will be included as inputs into various components of 4th quarter GDP after adjusting for any changes in prices, increased by a statistically insignificant $34 million to $251.6 billion, after September shipments were revised from $252.5 billion to $251.6 billion, now down 0.7% from August…shipments of transportation equipment were a drag on the October total, being down $0.3 billion or 0.4 percent to $83.7 billion, while all other durable goods shipments showed a 0.2% increase…of those, shipments of nondefense capital goods less aircraft rose 0.8% to $69,335 million, after September capital goods shipments were revised 0.1% lower to an 0.8% decrease..

Meanwhile, the value of seasonally adjusted inventories of durable goods, also a major GDP contributor, rose for the 15th time in 16 months, increasing by $1.4 billion or 0.3 percent to $432.0 billion, after August inventories were revised from $430.3 billion to $430.5 billion, still 0.5% higher than the prior month…an increase in inventories of transportation equipment was responsible for the October inventory increase, as they rose $1.8 billion or 1.3 percent to $147.4 billion, while the value of inventories other than those of transportation equipment fell 0.1%…

Finally, unfilled orders for manufactured durable goods, which are probably a better measure of industry conditions than the widely watched but volatile new orders, increased for the third time in 4 months, rising by $1.4 billion or 0.1 percent to $1,164.8 billion, after September unfilled orders were revised from $1,163.542 billion to $1,163.468 billion, still a statistically insignificant decrease from August….a $0.9 billion or 0.1 percent increase to $795.5 billion in unfilled orders for transportation equipment led the October increase, but unfilled orders excluding transportation equipment orders were also up 0.1% to $369.3 billion…compared to a year earlier, the unfilled order book for durable goods is still 1.6% below the level of last October, with unfilled orders for transportation equipment still 2.4% above their year ago level, on a 4.0% decrease in the backlog of orders for commercial aircraft and a 5.4% decrease in the backlog of new orders for motor vehicles…. 

New Home Sales Little Changed in October After September Sales Revised to a 12 Year High

The Census report on New Residential Sales for October (pdf) estimated that new single family homes were selling at a seasonally adjusted pace of 733,000 homes annually, which was 0.7 percent (±20.4 percent)* below the revised September rate of 738,000 new single family home sales annually, but 31.6 percent (±23.7 percent) above the estimated annual rate that new homes were selling at in October of last year….the asterisk indicates that based on their small sampling, Census could not be certain whether October new home sales rose or fell from those of September, with the figures in parenthesis representing the 90% confidence range for reported data in this report, which has the  largest margin of error and is subject to the largest revisions of any census construction series….with this report; sales of new single family homes in September were revised from the annual rate of 701,000 reported last month up to a post recession high 738,000 annual rate, while home sales in August, initially reported at an annual rate of 713,000 and revised to a 706,000 a year rate last month, were revised again but remained at a 706,000 a year rate with this report, and while July’s home sale rate, initially reported at an annual rate of 635,000 and revised from a 665,000 a year rate to a 666,000 a year rate last month, were revised down to a 660,000 annual rate with this release..

The annual rates of sales reported here are seasonally adjusted after extrapolation from the estimates of canvassing Census field reps, which indicated that approximately 57,000 new single family homes sold in October, unchanged from the estimated number of new homes that sold in September but up from the 43,000 homes that sold in October a year ago…..the raw numbers from Census field agents further estimated that the median sales price of new houses sold in October was $316,700, up from the median sale price of $310,200 in September but down from the median home sales price of $328,300 in October a year ago, while the average new home sales price in October was $383,300, up from the $366,900 average sales price in September, but down from the average sales price of $394,900 in October a year ago….a seasonally adjusted estimate of 327,000 new single family houses remained for sale at the end of October, which represents a 5.8 month supply at the October sales rate, up from the revised 5.7 months of new home supply in September…for graphs and additional commentary on this report, see the following two posts by Bill McBride at Calculated Risk: New Home Sales at 733,000 Annual Rate in October, New Cycle High in September and A few Comments on October New Home Sales

 

(the above is the synopsis that accompanied my regular sunday morning links emailing, which in turn was mostly selected from my weekly blog post on the global glass onion…if you’d be interested in receiving my weekly emailing of selected links, most picked from the aforementioned GGO posts, contact me…)      

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tables & graphs for November 30

rig count summary:

November 29 2019 rig count summary

daily natural gas prices:

November 30 2019 daily natural gas prices

weekly natural gas prices:

November 30 2019 weekly natural gas prices

quarterly natural gas prices:

November 30 2019 quarterly natural gas prices

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