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Tuesday, December 01, 2009

Might be worth noting that last paragraph on heating oil pricing, if you are a user...

Not much change in the markets this week
Gasoline up because of low refiner capacity

Media release


Conception Bay South, NL, December 01, 2009- Low refiner capacity utilization has resulted in only a slight increase to come for gasoline prices when the Public Utilities Board moves to set prices this coming Thursday. That’s according to George Murphy of the Consumer Group for Fair Gas Prices.

“It has been rather boring watching the markets this week, especially with no changes in some of the numbers that are readily apparent, with the exception of gasoline numbers,” said Murphy. “Numbers show only slight changes to heating and stove oils with those fuels down by 45/100ths of a cent. Diesel shows a very modest 2/10ths of a cent drop and gasoline shows a 1.1 cent a litre increase coming.”

“Low refiner capacity that sits at an almost historic low of 80 per cent is telling me that refiners are struggling to balance demand with supply. It appears to be a concerted move on the part of Big Oil to keep production down in the hope that demand will pick up, helping to support the price of the refined product. It appears that the move may be working. While demand is just half of a percentage point above last years figures, there was a small build in gasoline inventory last week leaving inventory there above that of last year by almost ten million barrels.”

“The distillate outlook, heating, stove and diesel prices, are showing mostly the same trend. Inventories there were impacted by just five hundred thousand barrels leaving inventories over last year up by 40 million barrels. That could spell better news for distillate fuel users if that trend keeps up. Higher than usual distillate inventories matched with lower demand this last week could carry through until springtime lessening the probability of higher heating oil prices and saving the consumer some grief. I’m hopeful that that trend will continue and help push prices down even more, or at least not increase prices to the extent first brought forward.”

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For more information, contact;

George Murphy
Group researcher

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