Speculators have got to be running on empty and on desperation!
Watching the oil markets this past week at least gave one some reasonable hope that, maybe...just maybe...consumers will be given some pause for low prices for gasoline this coming summer. Maybe we may be able to kick-start the economy by getting out and about and spend a few dollars while out on summer vacation...
Enter the start of the April buying contract...
Now, keep in mind that every year starting around March month, we usually see some sort of a move by speculators to put a few dollars on a bet that consumers will burn a little more gasoline during the summer than in any other time of the year...
Keep in mind too, that when they place their bets, it's usually hinged on the start of the US summer driving season, which as we all know in the markets has a traditional start of the US Memorial Day weekend. That usually falls on or about Canada's "May Two four" weekend.
So, with that "buying contract" for April opening officially yesterday, what did I see?...
A run-up in gasoline from about $1.05 US a gallon to yesterday's $1.31 US, an increase of twenty six cents US, or in Newfoundland and Labrador terms, an added 9.3 cents a litre...Plus taxes.
I'm keeping an eye to this to see if it sticks in the markets. At this point, it's just a "bet" that speculators are making that I'm hoping will burn them. Gasoline inventories are well up from last year's levels by almost 30 million barrels, making it a good bet that we may see more builds in gasoline inventories before the US summer driving season starts.
Right now, for the gouge that speculators are putting in the gasoline futures markets, I'm hoping that the latest US inventory data will burn them at their own game!
Fingers crossed on that one!
I'll have numbers for this week's price changes later tonight!
George
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