Hi to all,
Here's what I have for this week's price changes:
Heating and stove oils show an added 2.21 cents a litre.
Diesel shows up by 1.6 cents a litre, and...
Gasoline shows a very modest drop of 8/10ths of a cent.
While oil prices started off this week at a modest $55.16 a US barrel
(Brent), prices gradually started an increase after the US Energy
Information Administration stated that we should start to see a drop in
production coming from some of the US fracking fields where oil drilling
rigs have been "parked" since prices retreated from historic highs. The
EIA is predicting a drop of 57,000 barrels a day in May month as a
result of a halt in further production because of higher prices.
Don't look for a surprise spike in prices, unless something
extraordinary happens though. If prices do increase, look for rigs to go
back to work and bring prices lower again.
all this, there are still strong signs and, indeed questions that need
further research as to how come oil prices haven't retreated further
based on other evidence out there. Over the last week, for example,
crude oil in floating storage (in tankers being used for such) has risen
dramatically to count at 152 million barrels. That's an added 20
million barrels of crude oil stored away over the last three weeks. As
well, the prospects of Saudi Arabia increasing production this summer to
a record 11 million barrels a day has yet to hit the markets.
Needless to say, if I was trading in the markets, I would be worried
over the two notes here. The prospect of Saudi Arabia waving the
production stick should really be enough to keep Brent prices lower
again for the coming future. That prospect on the futures markets still
shows little growth in crude prices. Numbers show a mere $63 US a barrel
in the middle of 2016 and $68 US a barrel for the full year of 2017.
Might as well get used to lower oil for a while...
That's it for now!