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Tuesday, June 27, 2017

Price changes for Thursday, June 29, 2017


Hi to all,



Here’s what I have for this week’s price changes:



*Heating and stove oils show a drop of 1.1 cents a litre.

*Diesel fuel shows a drop of 1.5 cents a litre, and...

*Gasoline shows no change this week.



Markets steady. Waiting for Wednesday inventory data



“Consumers will not see any change to gasoline prices this week as the markets await inventory data from the U.S Energy Information Administration for any sign of rising or falling demand”. That word comes from George Murphy, group researcher with the Consumer Group for Fair Gas Prices. ”However, being the non-demand season for distillates like heating, stove oil and diesel, we’ll see some further retreat in prices”.



“The markets are searching for any reason for optimism amongst signs that demand still hasn’t shown any appreciable growth in demand for gasoline, and that sentiment continues as some are expressing ongoing concerns over the world glut of oil. There’s lots to go around.



“In what must be a surprise to most, the US EIA has reported three weeks of gasoline inventory building in the middle of the demand season for that fuel, and smack in one of the world’s most bustling economies, and with the final mystery of why demand hasn’t risen its head this summer season. At least not yet.



“Even the American Petroleum Institute earlier this evening found another build in both crude and gasoline inventories which could spell trouble for speculators in the gasoline markets for the rest of the summer. With demand faultering and a forty five day delivery time from oil patch to the consumer, time is fast running out for them. July is coming and it’s ‘mid-August’ on the buying markets in what could be a wrote-off season.



“Looks like what you see is what you’ll get for the rest of the summer season, barring any unforeseen or geo-political changes. It could be a much cheaper summer traveling season than what we’ve been used to”.



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For more information, contact;



George Murphy

Twitter @GeorgeMurphyOil

Tuesday, June 20, 2017

Price changes for Thursday, June 22, 2017


Hi to all,



Here’s what I have for this week’s price changes:



*Heating and stove oils to drop a penny.

*Diesel fuel to drop by 1.3 cents a litre, and...

*Gasoline to drop three cents a litre.



Oil and refined prices continue lower. Consumers to benefit



“Oil prices and refined commodity prices continue their retreat and consumers again will see the benefit”. That’s according to George Murphy, researcher with the Consumer Group for Fair Gas Prices.



“ The US Energy Information Administration’s weekly data last week showed a continued build in gasoline inventories that still shows refiners are producing more than what was needed in the face of expected demand that simply isn’t there---yet”, Murphy said.



“But we’re possibly coming to an end as small producers start to look at their break-even points as oil prices sink lower, so this next few weeks are going to be a huge test for everyone in the oil business. While further drops in prices are possible, they may be piece-meal compared to the last few weeks drops we’ve become accustomed to”.



News from OPEC also shows more oil than was expected coming out of Libya with that country producing more than 900 thousand barrels a day, rather than the expected 300 thousand a day in the previous month. While that may seem for some to be a small number, it throws a wrench into OPEC’s self-imposed cut of 1.2 million barrel a day that excluded both Libya and Nigeria due to damaged infrastructure from civil unrest.



“While ‘under a dollar’ a litre is still possible, we’d already be there except for the fact that there is still almost 9.8 cents a litre in extra taxes that we’re dealing with versus the same timeframe when we saw gas under a buck a litre”.



-30-



For more information, contact:



George Murphy

Twitter @GeorgeMurphyOil

Tuesday, June 13, 2017

Price changes for Thursday, June 15, 2017


Hi to all,

Here's what I have for this week's price changes:

          *Heating and stove oils to drop by 2.5 cents a litre.
          *Diesel fuel to drop by 2.6 cents a litre, and...
          *Gasoline to drop by FOUR cents a litre.

Market highlights

OPEC breaks its own production freeze
The fact that Libya and Nigeria were exempted from the OPEC cuts agreement and it's extension a month ago was telling on what was thought to be two countries in a rough position as far as stability goes, and they are. However, both Libya and Nigerian production has suddenly come back, rather unexpectedly to OPEC I may add, to throw further doubt into the world oil glut situation.
     Both Libya and Nigeria combined to push overall OPEC production up by another 330,000 barrels a day during May month.
     That has helped to moderate prices over the last week, and acquisition costs of oil have come down as well to reflect the benefits to consumers.

Gasoline demand weaker than usual?
Gasoline inventories, according to the US Energy Information last week, climbed instead of falling during one of the driving season's busiest times for speculators.
     Weaker refinery capacity also showed the markets that with refinery production dropping, refiners were still able to add gasoline to the overall inventory, casting further doubt on what demand there will be for product heading into the depths of summer.
     As previously forecast here, there's still some pressure to the downside for gasoline, but I'm keeping an eye to the refiner capacity number to see if refiners throttle back on output in a move to support prices for the next little while.
     Already a sign that there may be trouble for the speculator out there if that indeed happens!

That's it for this week!

Regards,

George Murphy
Twitter @GeorgeMurphyOil

Tuesday, June 06, 2017

Price changes for Thursday, June 8th, 2017


Hi to all,

Here's what I have for this week's price changes:

*Heating and stove oils show a drop of 2.8 cents a litre.
*Diesel fuel shows a drop of 3.5 cents a litre, and...
*Gasoline shows a drop of 2.1 cents a litre.

                                                                     
Market highlights

Oil stays steady in spite of Qatar situation
While some may have expected oil prices to take a sharp rise over recent tensions between Qatar and other Middle East neighbours, it seems some analysts have stepped back from the fray and are calling "business as usual" in the region.
     Fellow OPEC member states like Saudi Arabia have cut some ties with their neighbour over concerns that Qatar has been funding some fundamentalist organizations, like the Muslim Brotherhood and Al Qaeda.
     Whether proven or not, speculators think that it's back to the usual when it comes to the oil business as others see it as a simple difference between Sunni and Shiite.

API reports gasoline inventories up
The American Petroleum Institute is reporting a huge increase in gasoline inventories this week.
     According to the industry-led organization, gasoline inventories unexpectedly increased by just over four million barrels, while distillate also showed an increase of close on 1.8 million barrels.
     Oil inventories were down by 4.6 million barrels.
     The US Energy Information Administration releases its inventory data tomorrow noon Newfoundland time.

That's it for this week!

Regards,

George Murphy
Twitter @GeorgeMurphyOil

Tuesday, May 30, 2017

Price changes for Thursday, June 1st, 2017


Hi to all,



Here’s what I have for this Thursday’s price changes. Keep in mind that the gasoline price also includes performance of the product on the markets that compiles the overall number.



*Heating and stove oils show a drop of 1.4 cents a litre.

*Diesel fuel shows a slight drop of 6/10ths of a cent a  litre, and...

*Gasoline shows a drop of 10.4 cents a litre at the pumps.



Market highlights



In spite of summer, the markets are still skittish

While OPEC may have been successful in its mission to extend production cuts to help elevate prices, markets are not all that excited about it, even as the U.S summer driving season has arrived. With not so much as a whimper as a collective sigh, markets are still seeing some holes in the deal the OPEC and non-OPEC members signed a mere five days ago.

     With the agreement was signed, two OPEC nations, recovering from their own internal struggles, were left out of the agreement to reign in their production. That in itself has allowed the possibility of a direct increase in overall OPEC output from present levels. With Libyan production set to climb to 1.5 million barrels a day from 250,000 at present, the difference alone from Libya may be enough to stymy any support for OPEC’s cause of supporting prices.

     Also set this week was a chance for Nigerian production to possibly return from its recent lows, allowing it to not be subject to cuts as well. That leaves the possibility of Nigeria, now exempt from the agreement, to return to close on 2.6 million barrels a day of production.

     Analysts simply can’t see the way out for OPEC as U.S domestic production continues to climb to “pre-collapse” conditions.

     What may help support oil may come as a surprise for some, but it’s a relatively simple guess: While U.S domestic production has been increasing, it has slowed a little, possibly caused by hiring issues in the fields. An industry collapse two years ago that put so many out of work may also be a deterrent for some to return to an industry that is essentially still in a very volatile mood. That may give OPEC oil prices some support in the weeks to come, and I’m watching for that.



Gas taxes drop this Thursday

The Newfoundland and Labrador government, as stated in the last provincial budget, is set to drop gasoline taxes downwards by 8.5 cents a litre (9.8 cents taxes in) Thursday morning when prices will be adjusted by the Public Utilities Board’s Petroleum Pricing office.

      The increase to gasoline taxes saw the government increase road taxes from 16.5 cents a litre to 33 cents per litre in the 2016 budget.

      While I am thankful that the retreat in gas taxes has started, I am also looking forward to getting back to an even playing field between all the Atlantic Canada provinces as soon as next year’s budget.

       At least we’ll enjoy the break at the pumps for the next few weeks.



That’s it for this week!



Regards,



George Murphy

Twitter @GeorgeMurphyOil

Tuesday, May 23, 2017

Price changes for Thursday, May 25, 2017

Here's what I have for Thursday:

*Heating and stove oils to increase by 1.7 cents a litre....
*Diesel fuel to increase by 2.5 cents a litre, and...
*Gasoline to increase by 2.6 cents a litre.



Market highlights

Gasoline continues to rise
Gasoline prices continued to rise this week as the US driving season approaches it's traditional start with the U.S Memorial Day weekend.
      While gasoline demand remains a little weak for this time of the year, speculators are all in with the rising prospects of anticipated demand as the weather starts to warm.
      Gasoline inventories reported last week showed a close balance between rising refinery capacity and a slightly less than expected drawdown on inventories.

OPEC members sign on
With the official OPEC meeting now just two days away, most OPEC members are starting to fall in to an extension of the production cuts agreement signed in November, to another deal ending in March of 2018.
      The agreement has helped oil prices rise in the last week from it's yearly low just two weeks ago.
      Both Brent and WTI prices have risen close on $3 US a barrel over the last week or so helping the rise in gasoline and distillate prices this week.

Trump leaves some wondering
Donald Trump's wish to cut into the US strategic reserve has some wondering, and some in concern for Trump's overall energy policy.
      While Trump wants to reduce the reserve by close on half, it leaves consumers at risk of skyrocketing prices should the US be hit with a string of supply cuts as the world saw with OPEC in the 2000's.
      The release of crude stocks from the US strategic reserve was used as an emergency stop-gap measure to bring some relief to rising oil prices then, as well as a source of oil in 2004-05 when the Gulf of Mexico region was devastated by Hurricanes Rita and Katrina. Oil was sent to centrally based US refineries to keep product flowing to consumers when off-loading and refining of crude was disrupted along the coast at that time.
      With nearly 690 million barrels in reserve in times of emergency, it leaves some to wonder why he would weaken the country's sway on oil prices should another emergency occur.

That's it for this week!

Regards,

George Murphy
Twitter @GeorgeMurphyOil

Wednesday, May 17, 2017

Price changes for Thursday, May 18, 2017

Hi to all,
Here are the final numbers for this Thursday's price changes:
*Heating and stove oils show an added 2.2 cents a litre....
*Diesel fuel shows an added 2 cents a litre up, and...
*Gasoline shows an added 3.1 cents a litre.

Market Highlights
Gasoline set to increase as driving season approaches
The start of the summer driving season usually begins around the US Memorial Day holiday south of the border. While still a few days away, speculators are hoping to see an increase in gasoline demand this summer, and that's part reason why yours truly is seeing an increase in all spot prices across the board this week.
Saudi’s and Russia extend their cuts agreement
There is also breaking news from yesterday that showed OPEC member Saudi Arabia and non-OPEC producer Russia have signed on to an extension of their cuts agreement signed last November.
That agreement to maintain the same level of cuts extends now into March of 2018.
While it boosted oil prices in recent days, the promise of a powerful pickup in US domestic production (and production in other countries) should be enough to tip the scales back in a few days to dropping oil prices once again.
OPEC has to be careful.
While they may be fighting to bolster prices, they are again kicking open the door for a return of a more resilient US oil industry.
OPEC is set to meet officially May 25th in Vienna where cuts are on the agenda.
Sorry I didn't publish last week as I was in Cuba. Nice time away and I didn't even check the price at the pumps!

That's it for this week!
Regards,
George Murphy
Twitter @GeorgeMurphyOil