About The Author

Phil Flynn

Phil Flynn is writer of The Energy Report, a daily market commentary discussing oil, the Middle East, American government, economics, and their effects on the world's energies markets, as well as other commodity markets. Contact Mr. Flynn at (888) 264-5665

For years in my daily Energy Report on many occasions, and the Fox Business Network, I have called out the International Energy Agency’s (IEA) questionable data that seemed not so much based on facts but trying to push its big green energy agenda. Now it appears that House Republicans are doing the same, mirroring almost the same words and thoughts from some of my previous Energy Reports. In a letter to the Executive director of the International Energy Agency Fatih Birol, Republicans said that they ‘are concerned that the IEA has strayed from its core mission-promoting energy security. Wow! They took the words right out of my mouth or from a previous Energy Report but no matter, they are right to call them out as this has become a major issue as their dereliction of duty has become a threat to world energy security as well as US national security.

Some readers thought that my criticism of the IEA was just sour grapes on my part because the misreporting of supply and demand would impact my commodity positions. Ok, while there might be some truth in that the real reason was that I believe this continual underreporting of demand and over-estimation of supply was a blatant attempt to discourage investment in fossil fuels that would lead the world into an energy crisis and threaten the global economy and security putting undo burdens on the poor and the middle class of the world. But not to be negative. I did assure you that the green energy elites would be ok. I also stated that this green energy agenda would lead to global instability and sadly that has already begun to happen.

House Republicans agreed. Their words that could have been taken from my report saying, “In recent years the IEA has been undermining energy security by discouraging sufficient investment in energy supplies specifically oil natural gas and coal. Moreover its energy modeling no longer provides policymakers with balanced assessments of energy and climate proposals. Instead, it has become an energy transition cheerleader.” House Republicans went on to say that, “until recently the IEA has served as a valuable source of reliable information on the security of oil markets and it has provided A mechanism whereby oil-consuming countries can respond effectively to oil shortages. The IEA also provides global energy forecasts as part of its mission. They said, “As you have noted IEA forecasts have a tremendous influence on shaping how the world sees future energy needs consequently the IEA must conduct its energy security mission in an objective manner we believe that the IEA is failing to fulfill these responsibilities.”

House Republicans go on to say by its admission the IEA has placed greater emphasis on building net emission energy systems to comply with internationally agreed climate goals”. Yet I think it would be much better to tell the truth even if you think your massive big green energy donors and advocates can’t handle the truth because it destroys the hypocrisy and real dangers of its green energy agenda.

There is also a danger that gasoline prices will continue to go up as the surplus of gasoline supplies has disappeared according to the Energy Information Administration (EIA) weekly report. One of the problems with supplies being below normal if you have any hiccups in the system, it creates price increases and that is what we are seeing. Major refinery outages and demand that’s been better than expected have kept gasoline supplies tight. Even as gasoline demand slipped week over week causing the futures to pull back, the reality is that the supply surplus is gone. Now supplies have hit the lowest level of the year. That is the seventh straight week that gasoline supplies have fallen according to “Quantum Commodity Intelligence.” They pointed out the gasoline exports surged 21 million barrels a day for only the second time this year and said that Inventories fell by 3.3 million barrels or 1.4% to 230.7 million barrels in the week to 15 March, and their lowest since late December.

The pace of destocking slowed, however, and inventories inched back above their year-ago level but remained around 2% below their five-year average for the week. Stocks fell in every region, led by a 1.8 million barrel (-2.3%) draw in the US Gulf, where inventories slumped to a three-year low of 76.6 million barrels. That was followed by a 580,000 barrel draw in the Midwest, where BP has only just restarted its Whiting refinery after a six-week unplanned outage. Midwest refinery runs jumped 311,000 bpd on the week to 3.9 million bpd, their highest since the outage at the start of February. US-run rates inched 0.8% higher to 15.8 million bpd.

Also, the weak demand narrative for oil disappeared in yesterday’s Energy Information Administration report should demand robust. The EIA said that demand based on total products supplied over the last four-week period averaged 20.1 million barrels a day, up by 2.2% from the same period last year. Over the past four weeks, motor gasoline product supplied averaged 8.8 million barrels a day, up by 0.3% from the same period last year. Distillate fuel product supplied averaged 3.7 million barrels a day over the past four weeks, down by 1.9% from the same period last year. Jet fuel product supplied was down 0.2% compared with the same four-week period last year.

It seemed like oil prices were less excited yesterday about the Federal Reserve’s more dovish take on inflation and interest rates. Other markets like copper, platinum, platinum and silver exploded after the Fed’s outlook but oil struggled partly because in recent weeks we have seen these others metals fall in anticipation that the Fed was going to be more hawkish. Well it is still near the highs. Petroleum products were also overbought while the others were oversold. We’re looking for oil and products to consolidate for another leg higher so try to position yourselves on pullbacks from longer-term positions in the short term we expect to see some pretty good swings so day traders should start to have a lot of fun.

It seems like natural gas just can’t get a break after getting a little bit of a boost with winter returning. Now it has to face the fact that the Freeport LNG export facility is having more problems as we all remember the shutdown of the Freeport LNG export terminal caused natural gas to plummet from $11.00 when it’s shut down. Hart Energy reports that, “Freeport LNG on March 20 said its Train 2 liquefaction unit at the Texas plant has been shut down, while Train 1 will be taken down imminently as it expects inspections and any subsequent repairs at both the units to be completed by May. “It was during the January freeze that damage occurred in one of the Train 3 motors. Once we understood the cause of the damage, we knew it would be prudent to take proactive steps to inspect our other two trains,” a company spokesperson told Reuters in an email. Freeport said its Train 3 was now online and producing LNG. Each liquefaction train at Freeport can turn about 0.7 Bcf/d of gas into LNG. Earlier in the day, the company said that after maintenance work, Freeport LNG’s production capacity will increase by 10% from 15 million metric tons (MMmt) a year to just over 16.5 MMmt a year roughly by June. Additionally, the company’s Train 4, which has received all regulatory approvals, will add another 25% of LNG production capacity when it becomes operational, it said. Outages at Freeport LNG, the third-biggest LNG export plant in the United States.

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Phil Flynn

Senior Market Analyst & Author of The Energy Report

Contributor to FOX Business Network

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