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Monday, August 27, 2012

Tropical Storm Isaac at play in the markets

Just a quick note...

I’ve been watching “Hurricane Syndrome” season play itself out in the markets this past week. Numbers are reflecting the possibility that consumers will see something of an increase to come this Thursday, but the real news of any price spiking may come after the storm comes ashore somewhere along the Louisiana and Alabama coast.

Any landing of the storm itself will probably be enough to shut in any production and possibly disrupt refining of product. That’s the bigger worry to gasoline trading on the New York Mercantile Exchange (NYMEX). It’s the water and not the winds necessarily that will be more disruptive to consumer prices.

So far, while numbers are up slightly to consumers this week, it’s the aftereffects of the storm that might hit us harder. Mind you, the similarities between Katrina just seven years ago, and the track of this storm, are both eerily similar, and the consequences of the strength of the storm in the next day or so, will be well worth something to watch out for.

Numbers so far show an increase of just 7/10ths of a cent to heating and stove oils, an added one cent to diesel prices and gasoline shows just 1.6 cents a litre upwards. Nothing of concern here yet…

This morning shows gasoline trading upwards by 11 cents a US gallon which, if it holds through today and again tomorrow, may boost these numbers upwards by another penny or so to all fuels, but again, nothing substantial until we hear of the damage the storm has caused. Right now, the wolves are in the marketplace and they’re looking for any excuses.

Regards for now and I’ll be in touch if anything happens out there!

George Murphy

Group researcher/member

Consumer Group for Fair Gas Prices

Twitter: @GeorgeMurphyNDP

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