Hi to all,
In what was a sleeper of a week on the markets, very little of
anything was happening, including moves to any prices. I can't remember
the last time they moved as little as this. But here they are:
Heating and stove oils to drop an even penny.
Diesel prices down by 1.6 cents a litre, and...
Gasoline up just 9/10ths of a cent.
All eyes focused on the challenges that are coming to US storage
capacity this week as the oil markets are struggling with the fact that
US domestic production has literally taken up available storage space,
just another reason why analysts are talking about another possible
slide in prices to come. It is estimated that, if production maintains
itself and export and consumption of oil don't weigh in, we could be
looking at all capacity taken up in the Cushing, Oklahoma storage and
pricing facility. Some are predicting that prices could bottom out at
$20 US a barrel if that happens!
The second possible threat to
lower oil prices comes from what are called "teapot" producers out of
Russia, who are faced with crude oil runs and nowhere to export except
markets that compete with OPEC. Interestingly, Russian exports add
another 800K barrels a day to worldwide production, adding to the glut.
There's lot's of downward fundamentals playing on oil, but the only
upside to any increase in oil prices lately has been the thought that
the US will soon begin to raise interest rates. Speculation over any
increase in rates has dropped the US dollar against the Canadian dollar
in the last few days. Speculators have been adding oil and gold to their
portfolio's in answer to any possible rate increase.
The
Canadian dollar has increased against its US counterpart by close on 2.5
cents this last week as a result, almost negating any price increases
to refined product prices as a result.
That's it for this week!
...and I said nothing was happening!
Regards,
George Murphy
Twitter @GeorgeMurphyMHA
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