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Tuesday, February 27, 2007

Why you will be paying more for fuels in the future
Tonight, the people of Quebec have been victimized by Big Oil and our own gluttony. As consumption continues to increase at an alarming rate well above last years level, we have seen refinery fires in North America.
Thursday morning, the people of Newfoundland and Labrador will wake up to an added five cents a litre at the pumps to help put the fires out...
Were they caused by just ordinary accidents?
While no accident should be considered ordinary, I cannot help but think that consumer consumption may have been a marked contributer to what we have come to witness in Ontario and Quebec.
Our own gluttony for gasoline and the Big Oil policy of shutting down refineries to gain control of supply and demnd, has finally come home to roost for the consumer. While we burn it for Big Oil, have we also put them under pressure to meet that consumer demand? Have we become that thirsty for gasoline and their related commodities, that we have become the cause of the problem in the first place?
We have also become complacent in letting Big oil close refineries in the first place. Several refineries in Canada have closed over the past few years, the latest being a PetroCanada facility in Sarnia a couple of years ago. Some 18 refineries have closed since the early seventies in Canada and, have we seen demand decrease in that timeframe?
The answer is "no".
Fewer motorists existed than exist now and we have become a generation that has moved from trains to highwways and tractor trailer transport. While demand has increased, overall production capacity has decreased over the same time period.
Until you hear that Big Oil is going to increase the number of oil refineries, or that the number of drivers on the roads are going to drop, then we will be facing the prospect of ever-increasing petroleum pricing for the next generation to become witness to.
Maybe it's time we move back to the barn?

Saturday, February 24, 2007

Prices moving upwards
Stay tuned!

This picture, from the Canadian Press, shows a refinery fire at Imperial's Sarnia plant in December, 2006.

Might have been surprised if I didn't see some sort of a market ploy to get prices moving upwards again but, there we go. We're going to see the screws put to us again compliments of the traders on Wall Street.

Newfoundland and Labrador's turn is coming this Thursday as we'll be watching the pricies roll over at the pumps. While a little early to predict, so far, the numbers are showing an allowable 4.5 cents up at the pumps for gasoline.

Nova Scotia and New Brunswick got hit the other day and other regions are experiencing upwards moves by Big Oil.

The causes?

A refinery fire in Sarnia(above), the CN rail strike has contributed to shortages, another two refinery fires south of the border, Iran and it's pursuit of a nuclear program, ongoing inventory concerns, colder weather....

Shall I go on?

I'll have more for everyone on Tuesday Night/Wednesday morning so, be looking for the media announcement and the email release with the official numbers. There will be an increase but, it could range a little higher than this number with a couple of more trading days left.

I don't expect any miracles, though it's nice to see some divine intervention now and then.

Keep watching!

Thursday, February 15, 2007

Possible attacks on Canadian Oil facilities?
Don't laugh...It's possible!

I was disturbed that a branch of Al Qaeda has seen fit to recognize the importance of Canadian oil to the economics of the United States and how important our oil industry is to the U.S.

The story first broke yesterday on CTV News.

A couple of years ago I asked the same questions about security around the North Atlantic Refinery in Placentia Bay, the facilities in downtown Halifax owned by Imperial, and in New Brunswick owned by the Irvings.

I don’t think anyone took me serious then.
Then along comes this posting by the terrorist cell.

If anyone thinks there is little concern, let me refresh their memory on who this group is and what their capabilities are.

Twice now, to my memory they have attacked the Ras Tanura oil facility deep in Saudi Arabia.
The first time was with a small group of terrorists that tried to get into the facility and attack both foreign oil workers and the refinery system there.

The second time was with a larger group of people who also failed in their attempt to disable the facility. Both times, small weaponry was used but still with the loss of life.

The third time they try they may very well succeed. Any successful attempt at bringing down the facilities at Ras Tanura would possibly remove nearly 6.6 million barrels of crude oil a day from world markets.

While knocking out the North Atlantic Refinery would be miniscule in the world scale of refineries, its removal from the markets would have enormous economic impact-not just because of the fact it is a refinery, but for the fact that an economic target was successfully nailed by a terrorist group within North America again.

I won’t even get into what the ramifications are for the economy, let alone fuel pricing.

If these companies are going to take this threat lightly, they’re headed for a world of trouble.

There is nothing so dangerous as a determined enemy.

Tuesday, February 06, 2007

Look out!
Pricing pointing up

Consumer beware!

Since January 18, 2007, we saw crude oil reach a low of $50.47 US a barrel. You just knew it wasn't going to last long.

You'd be right if you guessed upwards movement is coming to consumers in the coming days...

Numbers so far, are showing an allowable upwards movement on stove oils of something in the order of 4.4 cents a litre. That may be pointing the way up for distillates like heating oils and diesels.

Gasoline pricing is also into interrupt territory and consumers will likely see a movement up by something in the order of 4.6 cents on a litre.

Nova Scotia and New Brunswick users beware and fill before Friday as, I also have upwards movement on gasoline on the consumer level. Because you have a different adjustment time, you won't see as much in the Maritimes but, you will still get hit. So far, I have a 3.4 cent a litre movement to come to you.

Colder weather and OPEC cuts are taking the blame this time around but, you have to ask yourself if the market traders should be under closer scrutiny for this one. Being this close to the end of winter, is it that likely that we are going to go through what's in total inventory?

Perhaps a U.S investigation of trader practises in the U.S is in order?

Oh well...Here we go again!

Monday, February 05, 2007

Auditor General and your road taxes...
"Let's make a deal"
The Auditor General's report on spending told Newfoundland and Labradorians something disturbing that, as consumers of gasoline and diesel products, we should all be disgusted with.
His report stated that...
"In 1996, we concluded that the department was not adequately managing the road system. A decade later, we have come to the same conclusion."
Now, I don't know about you but, this one bugs the hell out of me considering the fact that we haven't seen good road maintenance in spite of the money consumers have invested. Here in Newfoundland and Labrador, we have seen road taxation levels of 16.5 cents a litre on every drop of motive fuel sold here. According to the A. G's report, last year, we saw a paltry $36 million invested when there was an estmate in the 2006 budget of $142.7 million to be collected. The Actual for 2005 was $141.5 million.
There is something wrong with this number...
Last week when the report came out, I took the time to hunt down some of the numbers the A'G use to base his numbers on.
1997's actual amount collected from road taxes totalled $119.4 million to yesterdays report of 142.7. people should be shocked to learn that, we haven't seen strategic investment in the Labrador region of the province where road infrastructure has been a tiresome fight for the citizenry there as well. They deserve their fair share and need it desperately, not a piece of "chip seal" that they'll get on an experimental basis.
What the citizens of this province need is the promise that every cent collected in the form of road taxation goes directly to roads and their related ferry systems in Newfoundland and Labrador...
What the A'G's report gave us was the fact that, since 2002's investment of some $80 million, there's no wonder we're complaining about roads and ferries here in Newfoundland and Labrador, moreso now than ever...
We just don't know when we'll see that strategic investment happen...
Get ready. What you're going to hear in the coming days will be chatter from the governing Tories about the fed's not investing their share...
Ya right...
Deals for roads include a good working relationship with those upalong.
Not likely that's going to happen any time soon...