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Tuesday, August 22, 2017

Price changes for Thursday, August 24, 2017


Hi to all,



Here’s what I have for this week’s price changes:



*Heating/stove oils show a drop of two cents a litre.

*Diesel shows a drop of 1.9 cents a litre, and...

*Gasoline shows a drop of 6/10ths of a cent a litre.



Gasoline, Distillate fuels continue lower



“We may be starting to formulate a picture for heating oil prices for this winter as the focus comes off gasoline prices from this past summer, and consumers hopefully will see those benefits if the down trend continues”. That news from George Murphy, oil analyst with the Consumer Group for Fair Gas Prices.



Gasoline and distillate prices again continued to drop as lower oil and refined product prices showed a retreat after Libyan crude again was set for export. A shutdown of Libyan exports on Thursday helped to increase Brent prices, but turned lower as agreement was said to re-open ports on Monday.



“It wasn’t so much as a surprise to see Libyan exports shut in once again, but there was an obvious peaceful resolution put in place that played into the markets over a very quick period”. Murphy said. “Again, prices started to show a downwards retreat especially for refined distillates.



“It’s the right time of year to show a drop in distillates leading into the fall and winter heating seasons as this is a traditional time of year we see that run-up in prices ahead of the demand season. To see a drop this time of year may reflect what speculators may be thinking: that there’s not a lot to be gained in the markets for distillates again this year. While spot prices are still ten cents a litre higher that what they were for the same timeframe last year, a downward trend may be signalling further drops to come in prices”.



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For more information, contact;



George Murphy
Twitter @GeorgeMurphyOil

Tuesday, August 08, 2017

Price changes for Thursday, August 10, 2017


Hi to all,



Here’s what I have for this week’s price changes:



*Heating/stove oils will increase by 7/10ths of a  cent a litre.

*Diesel fuel shows an increase of 9/10ths of a cent a litre.

*Gasoline shows an increase of 1.2 cents a litre



Continued demand increase adds up to an increase in gasoline prices



If there was any hope for speculators to make a dollar in the gasoline markets, that time is quickly slipping away with the end of summer. This week’s increase in prices may be the last week for that as prices are set to increase to consumers by just over a penny. That’s according to George Murphy, group researcher for the Consumer Group for Fair Gas Prices.



“Last week showed just the second week in a row this summer where demand was shown to be increasing during the summer months. It been remarkable to see demand during the summer as low as what it has been in a year where the US economy has been booming.” Murphy said. ”Speculators are enjoying a ‘last gasp’ as the summer driving season comes to a close”.



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For more information, contact:



George Murphy

Tuesday, August 01, 2017

Price changes for Thursday, August 3rd, 2017


Hi to all,



Here’s what I have for this week’s price changes:



*Heating/stove oils show an increase of 3.1 cents a litre.

*Diesel fuel shows an increase of 3.6 cents a litre, and...

*Gasoline shows an increase of 1.7 cents a litre*.

                                       *Gasoline showed considerable volatility over the weekend and did not appear in the numbers until Monday. I believe gasoline may see a larger increase than what is shown here.



Time to drop the tax on heating again?



“If consumers are starting to feel the pinch of rising prices again, it should be no surprise. Government should bring some relief in taxes collected on heat again”. That’s according to George Murphy, energy watchdog.



“It seems that everyone and everything dealing with energy to consumers are looking for a piece of our pockets again, both on the electricity front and on the petroleum products end of things. While others have applied for electricity price increases, spot prices for distillates like heating and stove oils are starting to rise as speculators try and make a buck off the backs of consumers after a failed season of gasoline profit-taking.



“We’re again facing upwards pricing pressure from all sides,  Murphy said. “And that pressure is being widely felt by everyone as we get closer to fall and winter. Already, I am hearing from those who can’t afford to pay any more in taxes on rising commodity prices and that’s a warning sign to government that we will need further relief for those who can’t afford to keep warm this winter. Consumer’s pockets are simply empty from mounting debt.



“It’s time that the government meet everyone’s needs and drop the tax on necessities like heat, which is an ongoing health concern for most”.



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For more information, contact:



George Murphy

Twitter @GeorgeMurphyOil

Tuesday, July 25, 2017

No major changes with all the market confusion out there...


Hi to all,



Here’s what I have for this week’s price changes:



*Heating and stove oils show no change in price.

*Diesel fuel shows an increase of just 4/10ths of a cent a litre, and...

*Gasoline shows an increase of 3/10ths of a cent.



Gasoline price to remain relatively stable this week



“Gasoline prices will remain relatively steady this week with numbers showing just a 3/10ths of a cent a litre increase in the regulated maximum price at the pumps”. That news from George Murphy, consumer advocate and energy market-watcher. “The numbers are falling into my margin for error here, so there may be nothing serious happening this week that will cost us anything significant.”



While markets are in turmoil, nobody seems to have a handle on what constitutes market-changing news anymore, so, at least to me, no one is willing to take the risks in the energy markets until there’s some more stability.” Murphy said.



“OPEC members met again this past week, but in a surprise series of moves and who you talk to, everyone is on the same page when it comes to cuts, then everyone is not on the same page. While Nigeria, for example, have agreed to a production cut that limits them to a daily production of 1.8 million barrels a day, they are only pumping at 1.6 million barrels. Then there’s Iraq. While they’ve agreed to limit production under the agreed production cut arrangement, they’ve come out today announcing they will hit five million barrels a day by the end of this year. Presently, they produce almost 4.5 million barrels a day”.



Confusing as it sounds, the news is reflecting a market reality to consumers that no one knows which way prices should head under these conditions, and while demand may be up, the prospects for oil breaking into newer highs for the year seem distant.



“Then we have news from the US that shows that the US may set a new production record of ten million barrels a day domestic production by the end of this year that would bring more oil into the markets. That’s telling me that regardless of the news out of OPEC, there’s a bigger player out there that simply didn’t have the influence it now has ten years ago, and consumers will benefit from the confusion for the time-being”.



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For more information, contact:



George Murphy

Twitter @GeorgeMurphyOil

Tuesday, July 18, 2017

Price changes for Thursday, July 20, 2017


Hi to all,



Here’s what I have for this week’s price changes:



*Heating/stove oils show an increase of a half penny a litre.

*Diesel fuel shows an increase of 8/10ths of a cent a litre, and...

*Gasoline shows an increase of a penny at the pumps.



Strength of a demand increase reflected at the pumps this week



“Consumers will again see an up-tick in prices at the pumps this week but, as in previous weeks, it’s not going to be a shocker as gasoline prices are only expected to rise a penny a litre”. That’s from George Murphy, oil researcher.



“Modest increases in demand for gasoline have been observed over the past few weeks, and while not a threat to current prices at the pump ,any up-tick further in demand may help to increase prices again exponentially. I’m still trying to find why demand has not reached the same numbers it has last year, and that’s being reflected in the price we’re paying. You see a slight increase in demand and the price goes up, but so also does the Canadian dollar saving us a few pennies.



“If anything, I’m noticing an early entry by some into the distillate markets, which is also a strong signal that the summertime gasoline market is pretty much a write-off. With September buying contracts already out, it’s a safe bet to say that summer prices will pretty much stay around the same level we’re all looking at now”.



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For more information, contact:



George Murphy

Twitter @GeorgeMurphyOil

Tuesday, July 11, 2017

Price changes for Thursday, July 13, 2017

Hi to all,

Short and sweet this week as I'm heading straight to the fire-pit!

Consider it my summer vacation three hours at a time...lol

But, before I do, I'll leave you with the week's price changes and a few tidbits from the markets. Here's what I have:

*Heating, stove oil and Diesel all show a drop of 1.1 cents a litre.
*Gasoline shows no changes this week.

So, here's one market highlight I will leave you as the kids are calling...I'll comment on it next week, but it may be apparent what might be about to transpire. I'm thinking all OPEC members will start in too...

Surprise, surprise, but OPEC's leading producer and leader when it came to leading other members into the November 2016 production cut scheme to bolster oil prices, has been nailed with the news that it broke ranks with its fellow members by over-producing on it's own imposed production quota!

Note the party balloons and cake...

There was no surprise here as Saudi Arabia, the leader of the pack in the cuts department, simply couldn't resist the fact that on occasion, things like this will happen. The Saudi's produced 10.07 million barrels a day last month, about 200 thousand more than its quota.

Now, with Libya and Nigerian production also on the rebound, ask yourself how long it will be before the other members of OPEC also break ranks...

Have a good week!

Regards,

George
Twitter @GeorgeMurphyOil

Monday, July 03, 2017

Price changes for Thursday, July 6, 2017


Hi to all,

Here’s what I have for this Thursday’s price changes, and all a little early as a result of markets being closed tomorrow as a result of the U.S Independence Day holiday:

*Heating and stove oil show an increase of 2.7 cents a litre.
*Diesel fuel shows an added 3.1 cents a litre, and...
*Gasoline shows an added 2.7 cents a litre at the pumps.

Consumers to see an increase at the pumps for the first time in weeks

The numbers are in early as a result of the US markets being closed tomorrow as a result of the U.S Independence Day holiday, but even the holiday south of the border isn’t going to go the trend of the last few weeks with price drops.

On the contrary...

“It’s almost strange to see it after the last couple of weeks drops at the pumps, but consumers will see an increase at the pumps this week as gasoline demand starts to match refinery output”. That news from George Murphy, group researcher for the Consumer Group for Fair Gas Prices. “Last week saw a very slight draw on gasoline inventories immediately ahead of the U.S holiday, and along with rising oil, refined commodity prices also increased.”

“There are signs of support for oil prices out there as both the U.S rig count was down for the first time in twenty four weeks, and signs from the U.S Energy Information Administration that domestic output last week dropped 100,000 barrels a day, a sharp drop that comes as a sign that small producers in the shale fields may be more susceptible to lower prices than what was first thought. This may have led to ‘second thoughts’ to further investment in these projects, and that’s where we started to see a contraction in oil output. Some speculators placed a ‘break even’ point at $35 U.S, but investors started pulling out well before $45 US, showing a weak bottom remains for shale resources and that the ‘break even ‘ point is much higher. Long term projects have a distinct advantage against smaller projects.

“In spite of the news from OPEC member Libya of rising production and exports from the war-torn country’s return to the markets, oil prices still saw some support as a result of smaller shale simply not going to be able to attract the investment because of high risk and low oil prices. It seems that OPEC cuts may read in the markets again until oil rises to the point where small shale production can attract investment again. The market pendulum has again swung in favour of OPEC and other non-OPEC producers in it for the long term.

“On average, Brent and WTI have increased the past week by $3 US a barrel with refined commodities showing strength based on the increase to oil prices. It was only ‘natural’ to see gasoline demand start to rise before the holiday in the U.S and we can only hope that we can see the trend of low prices return for the rest of the summer”.

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For more information, contact:

George Murphy
Twitter @GeorgeMurphyOil

Tuesday, June 27, 2017

Price changes for Thursday, June 29, 2017


Hi to all,



Here’s what I have for this week’s price changes:



*Heating and stove oils show a drop of 1.1 cents a litre.

*Diesel fuel shows a drop of 1.5 cents a litre, and...

*Gasoline shows no change this week.



Markets steady. Waiting for Wednesday inventory data



“Consumers will not see any change to gasoline prices this week as the markets await inventory data from the U.S Energy Information Administration for any sign of rising or falling demand”. That word comes from George Murphy, group researcher with the Consumer Group for Fair Gas Prices. ”However, being the non-demand season for distillates like heating, stove oil and diesel, we’ll see some further retreat in prices”.



“The markets are searching for any reason for optimism amongst signs that demand still hasn’t shown any appreciable growth in demand for gasoline, and that sentiment continues as some are expressing ongoing concerns over the world glut of oil. There’s lots to go around.



“In what must be a surprise to most, the US EIA has reported three weeks of gasoline inventory building in the middle of the demand season for that fuel, and smack in one of the world’s most bustling economies, and with the final mystery of why demand hasn’t risen its head this summer season. At least not yet.



“Even the American Petroleum Institute earlier this evening found another build in both crude and gasoline inventories which could spell trouble for speculators in the gasoline markets for the rest of the summer. With demand faultering and a forty five day delivery time from oil patch to the consumer, time is fast running out for them. July is coming and it’s ‘mid-August’ on the buying markets in what could be a wrote-off season.



“Looks like what you see is what you’ll get for the rest of the summer season, barring any unforeseen or geo-political changes. It could be a much cheaper summer traveling season than what we’ve been used to”.



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For more information, contact;



George Murphy

Twitter @GeorgeMurphyOil

Tuesday, June 20, 2017

Price changes for Thursday, June 22, 2017


Hi to all,



Here’s what I have for this week’s price changes:



*Heating and stove oils to drop a penny.

*Diesel fuel to drop by 1.3 cents a litre, and...

*Gasoline to drop three cents a litre.



Oil and refined prices continue lower. Consumers to benefit



“Oil prices and refined commodity prices continue their retreat and consumers again will see the benefit”. That’s according to George Murphy, researcher with the Consumer Group for Fair Gas Prices.



“ The US Energy Information Administration’s weekly data last week showed a continued build in gasoline inventories that still shows refiners are producing more than what was needed in the face of expected demand that simply isn’t there---yet”, Murphy said.



“But we’re possibly coming to an end as small producers start to look at their break-even points as oil prices sink lower, so this next few weeks are going to be a huge test for everyone in the oil business. While further drops in prices are possible, they may be piece-meal compared to the last few weeks drops we’ve become accustomed to”.



News from OPEC also shows more oil than was expected coming out of Libya with that country producing more than 900 thousand barrels a day, rather than the expected 300 thousand a day in the previous month. While that may seem for some to be a small number, it throws a wrench into OPEC’s self-imposed cut of 1.2 million barrel a day that excluded both Libya and Nigeria due to damaged infrastructure from civil unrest.



“While ‘under a dollar’ a litre is still possible, we’d already be there except for the fact that there is still almost 9.8 cents a litre in extra taxes that we’re dealing with versus the same timeframe when we saw gas under a buck a litre”.



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For more information, contact:



George Murphy

Twitter @GeorgeMurphyOil

Tuesday, June 13, 2017

Price changes for Thursday, June 15, 2017


Hi to all,

Here's what I have for this week's price changes:

          *Heating and stove oils to drop by 2.5 cents a litre.
          *Diesel fuel to drop by 2.6 cents a litre, and...
          *Gasoline to drop by FOUR cents a litre.

Market highlights

OPEC breaks its own production freeze
The fact that Libya and Nigeria were exempted from the OPEC cuts agreement and it's extension a month ago was telling on what was thought to be two countries in a rough position as far as stability goes, and they are. However, both Libya and Nigerian production has suddenly come back, rather unexpectedly to OPEC I may add, to throw further doubt into the world oil glut situation.
     Both Libya and Nigeria combined to push overall OPEC production up by another 330,000 barrels a day during May month.
     That has helped to moderate prices over the last week, and acquisition costs of oil have come down as well to reflect the benefits to consumers.

Gasoline demand weaker than usual?
Gasoline inventories, according to the US Energy Information last week, climbed instead of falling during one of the driving season's busiest times for speculators.
     Weaker refinery capacity also showed the markets that with refinery production dropping, refiners were still able to add gasoline to the overall inventory, casting further doubt on what demand there will be for product heading into the depths of summer.
     As previously forecast here, there's still some pressure to the downside for gasoline, but I'm keeping an eye to the refiner capacity number to see if refiners throttle back on output in a move to support prices for the next little while.
     Already a sign that there may be trouble for the speculator out there if that indeed happens!

That's it for this week!

Regards,

George Murphy
Twitter @GeorgeMurphyOil

Tuesday, June 06, 2017

Price changes for Thursday, June 8th, 2017


Hi to all,

Here's what I have for this week's price changes:

*Heating and stove oils show a drop of 2.8 cents a litre.
*Diesel fuel shows a drop of 3.5 cents a litre, and...
*Gasoline shows a drop of 2.1 cents a litre.

                                                                     
Market highlights

Oil stays steady in spite of Qatar situation
While some may have expected oil prices to take a sharp rise over recent tensions between Qatar and other Middle East neighbours, it seems some analysts have stepped back from the fray and are calling "business as usual" in the region.
     Fellow OPEC member states like Saudi Arabia have cut some ties with their neighbour over concerns that Qatar has been funding some fundamentalist organizations, like the Muslim Brotherhood and Al Qaeda.
     Whether proven or not, speculators think that it's back to the usual when it comes to the oil business as others see it as a simple difference between Sunni and Shiite.

API reports gasoline inventories up
The American Petroleum Institute is reporting a huge increase in gasoline inventories this week.
     According to the industry-led organization, gasoline inventories unexpectedly increased by just over four million barrels, while distillate also showed an increase of close on 1.8 million barrels.
     Oil inventories were down by 4.6 million barrels.
     The US Energy Information Administration releases its inventory data tomorrow noon Newfoundland time.

That's it for this week!

Regards,

George Murphy
Twitter @GeorgeMurphyOil

Tuesday, May 30, 2017

Price changes for Thursday, June 1st, 2017


Hi to all,



Here’s what I have for this Thursday’s price changes. Keep in mind that the gasoline price also includes performance of the product on the markets that compiles the overall number.



*Heating and stove oils show a drop of 1.4 cents a litre.

*Diesel fuel shows a slight drop of 6/10ths of a cent a  litre, and...

*Gasoline shows a drop of 10.4 cents a litre at the pumps.



Market highlights



In spite of summer, the markets are still skittish

While OPEC may have been successful in its mission to extend production cuts to help elevate prices, markets are not all that excited about it, even as the U.S summer driving season has arrived. With not so much as a whimper as a collective sigh, markets are still seeing some holes in the deal the OPEC and non-OPEC members signed a mere five days ago.

     With the agreement was signed, two OPEC nations, recovering from their own internal struggles, were left out of the agreement to reign in their production. That in itself has allowed the possibility of a direct increase in overall OPEC output from present levels. With Libyan production set to climb to 1.5 million barrels a day from 250,000 at present, the difference alone from Libya may be enough to stymy any support for OPEC’s cause of supporting prices.

     Also set this week was a chance for Nigerian production to possibly return from its recent lows, allowing it to not be subject to cuts as well. That leaves the possibility of Nigeria, now exempt from the agreement, to return to close on 2.6 million barrels a day of production.

     Analysts simply can’t see the way out for OPEC as U.S domestic production continues to climb to “pre-collapse” conditions.

     What may help support oil may come as a surprise for some, but it’s a relatively simple guess: While U.S domestic production has been increasing, it has slowed a little, possibly caused by hiring issues in the fields. An industry collapse two years ago that put so many out of work may also be a deterrent for some to return to an industry that is essentially still in a very volatile mood. That may give OPEC oil prices some support in the weeks to come, and I’m watching for that.



Gas taxes drop this Thursday

The Newfoundland and Labrador government, as stated in the last provincial budget, is set to drop gasoline taxes downwards by 8.5 cents a litre (9.8 cents taxes in) Thursday morning when prices will be adjusted by the Public Utilities Board’s Petroleum Pricing office.

      The increase to gasoline taxes saw the government increase road taxes from 16.5 cents a litre to 33 cents per litre in the 2016 budget.

      While I am thankful that the retreat in gas taxes has started, I am also looking forward to getting back to an even playing field between all the Atlantic Canada provinces as soon as next year’s budget.

       At least we’ll enjoy the break at the pumps for the next few weeks.



That’s it for this week!



Regards,



George Murphy

Twitter @GeorgeMurphyOil

Tuesday, May 23, 2017

Price changes for Thursday, May 25, 2017

Here's what I have for Thursday:

*Heating and stove oils to increase by 1.7 cents a litre....
*Diesel fuel to increase by 2.5 cents a litre, and...
*Gasoline to increase by 2.6 cents a litre.



Market highlights

Gasoline continues to rise
Gasoline prices continued to rise this week as the US driving season approaches it's traditional start with the U.S Memorial Day weekend.
      While gasoline demand remains a little weak for this time of the year, speculators are all in with the rising prospects of anticipated demand as the weather starts to warm.
      Gasoline inventories reported last week showed a close balance between rising refinery capacity and a slightly less than expected drawdown on inventories.

OPEC members sign on
With the official OPEC meeting now just two days away, most OPEC members are starting to fall in to an extension of the production cuts agreement signed in November, to another deal ending in March of 2018.
      The agreement has helped oil prices rise in the last week from it's yearly low just two weeks ago.
      Both Brent and WTI prices have risen close on $3 US a barrel over the last week or so helping the rise in gasoline and distillate prices this week.

Trump leaves some wondering
Donald Trump's wish to cut into the US strategic reserve has some wondering, and some in concern for Trump's overall energy policy.
      While Trump wants to reduce the reserve by close on half, it leaves consumers at risk of skyrocketing prices should the US be hit with a string of supply cuts as the world saw with OPEC in the 2000's.
      The release of crude stocks from the US strategic reserve was used as an emergency stop-gap measure to bring some relief to rising oil prices then, as well as a source of oil in 2004-05 when the Gulf of Mexico region was devastated by Hurricanes Rita and Katrina. Oil was sent to centrally based US refineries to keep product flowing to consumers when off-loading and refining of crude was disrupted along the coast at that time.
      With nearly 690 million barrels in reserve in times of emergency, it leaves some to wonder why he would weaken the country's sway on oil prices should another emergency occur.

That's it for this week!

Regards,

George Murphy
Twitter @GeorgeMurphyOil

Wednesday, May 17, 2017

Price changes for Thursday, May 18, 2017

Hi to all,
Here are the final numbers for this Thursday's price changes:
*Heating and stove oils show an added 2.2 cents a litre....
*Diesel fuel shows an added 2 cents a litre up, and...
*Gasoline shows an added 3.1 cents a litre.

Market Highlights
Gasoline set to increase as driving season approaches
The start of the summer driving season usually begins around the US Memorial Day holiday south of the border. While still a few days away, speculators are hoping to see an increase in gasoline demand this summer, and that's part reason why yours truly is seeing an increase in all spot prices across the board this week.
Saudi’s and Russia extend their cuts agreement
There is also breaking news from yesterday that showed OPEC member Saudi Arabia and non-OPEC producer Russia have signed on to an extension of their cuts agreement signed last November.
That agreement to maintain the same level of cuts extends now into March of 2018.
While it boosted oil prices in recent days, the promise of a powerful pickup in US domestic production (and production in other countries) should be enough to tip the scales back in a few days to dropping oil prices once again.
OPEC has to be careful.
While they may be fighting to bolster prices, they are again kicking open the door for a return of a more resilient US oil industry.
OPEC is set to meet officially May 25th in Vienna where cuts are on the agenda.
Sorry I didn't publish last week as I was in Cuba. Nice time away and I didn't even check the price at the pumps!

That's it for this week!
Regards,
George Murphy
Twitter @GeorgeMurphyOil

Thursday, May 04, 2017

Good or bad, Oil takes a dive

Well, if you saw oil drop like a stone like I did today, you must have been asking what was on the go?

Oil dropped on news that there's a "potential" settlement between rival factions in Libya. If an unsettled peace does come in, it will probably mean a quick increase in Libyan production and exports.

Why is that important?...

When OPEC and non-OPEC producers signed on to their agreement at the end of November, 2016, Libya, another OPEC member, was not included in the overall production cut. At the time, civil unrest had been raking the country, so, members decided that they would not be included in the cuts Implimented by OPEC. That cut came in around 1.2 million barrels, while non-OPEC producers like Russia, added another 600,000 barrels.

    With Libyan production down to 200,000 barrels at the time, I guess the rest of OPEC didn't think there would be a turn-around in Libyan production like what is expected to happen now.
Libyan production was initially set around 1.5 million barrels a day before the unrest struck, and could all be back online as early as July.

    We may have to wait until May 25th to see the final result of all this, as OPEC is expected to meet then, and they may just decide to deepen the cuts, or forget that option altogether, in which case, we may see oil prices crash again.

    While all a good thing on a consumer perspective, oil's volatility in a situation such as this, does nothing for the provincial coffers.

Regards,

George
Twitter #GeorgeMurphyOil

Tuesday, May 02, 2017

Price changes for Thursday, May 4, 2017


Hi to all,



Here’s what I have for this week’s price changes:



*Heating and stove oil both show a drop of 1.3 cents a litre.

*Diesel fuel shows a drop of 1.2 cents a litre, and...

*Gasoline shows a drop of 3.3 cents a litre at the pumps.



Market highlights



Can OPEC hold it together?

      Questions surround OPEC in its ability to “keep the group together” in light of recent news and data that shows some OPEC members have not been holding to their end of agreed-upon production cuts the group made in late November.

      While Saudi Arabia has cut back, their neighbours Iran and Iraq have been pumping out extra in the bid to gain market-share and may very well be the reason why in recent weeks, Saudi Arabia has been discounting product prices to both Asian and European buyers.

      If they continue to over-produce, it will itself bring doubts to the oil markets whether the group can maintain, let alone extend a production cut that was meant to support oil prices.



Two weeks of gas inventory gain means a drop in prices

      The last two weeks of gains in overall US gasoline inventories has resulted in a further break for consumers on both sides of the border again this week.

       US inventories of gasoline increased again last week according to the US Energy Information Administration, this time by 3.7 million barrels.

       This is the traditional time of the year that we see extra pressure on gasoline inventories that usually results in increased prices to consumers as the U.S Memorial Day holiday approaches

       The next EIA inventory report gets released Wednesday noon NL time.



That’s it for this week!



Regards,



George Murphy

Twitter @GeorgeMurphyOil

Tuesday, April 25, 2017

Price changes for Thursday, April 27, 2017

Hi to all,

Here's what I have for this week's price changes:

*Heating and stove oil show a drop of 2.4 cents a litre....
*Diesel shows a drop of 2.8 cents a litre, and...
*Gasoline shows a drop of 2.9 cents a litre from the regulated maximum.


Market highlights

API reports crude and gasoline inventories as "up"
      The American Petroleum Institute, an industry organization, has released its inventory report for the last week, and it's not good if you're a speculator.
      While crude only showed a growth of 900,000 barrels, gasoline showed a surprising build of 4.4 million barrels over the last week.
      If tomorrow's EIA inventory report also shows a build in inventories, it will be a troubling sign that demand may have weakened ahead of the start of the summer driving season
.
Doubts about OPEC cut extension
      Speculators must be getting nervous...
      While US domestic output continues to show robust growth, OPEC is now asking itself whether the group's output cuts are having the desired effect with oil prices. Doubts that OPEC will maintain their self-imposed output cuts past May month may be signaling the prospect that OPEC may again open the spigots in an attempt to turn down US growth.
      US domestic oil output has increased by close on 850,000 barrels since the last OPEC meeting on cuts at the end of November, well ahead of the pace that the EIA predicted for 2018.

      Stay tuned. This week could be interesting!

Regards,

George Murphy
Twitter @GeorgeMurphyOil

Wednesday, April 19, 2017

Price changes for Thursday, April 20th, 2017


Hi to all,

Here are expected price changes for this Thursday:

*Heating, stove oil and Diesel are all expected to increase by 3/10ths of a cent a litre, and......
*Gasoline shows a drop of a cent a litre.

   Keep in mind my margin for error of 3/10ths of a cent a litre.

Market highlights

Saudi's say "too soon"
In what some consider to be a major shift in OPEC's thinking, the Saudi Arabian oil minister says it is "too soon" to talk about extending the cuts OPEC and non-OPEC members agreed to back in November.

   The six month agreement to cut production is a good reason why some have seen the price of oil rise to present levels, but it was expected by most that the agreement would be extended for another six months beyond May.
   Stay tuned as OPEC meets again in Vienna May 25th.

Province to cut back on gas taxes

The budget has some good news for consumers who were hoping to see a retreat in gasoline prices.

   Largely unexpected, the provincial government made the decision to lower gas taxes by 8.5 cents a litre (9.8 taxes in) by June 1st, and a further four cents a litre (4.9 taxes in) as of December 1st, while the remainder of the initial increase will be reviewed in the Fall.

   I was initially hoping that the budget would lower gas taxes by five cents a litre, so, this move was surprising, but at the same time, I was pleased to see the retreat in taxes immediately before summer, and well after the upswing in summer gasoline prices.

   It will also serve to put a little more disposable income into the hands of consumers as well as transportation-based small businesses.



Regards for now,

George Murphy
Twitter @GeorgeMurphyOil

Tuesday, April 11, 2017

Price changes for Thursday, April 13, 2017


Good evening to all,

Here's what I have for price changes this week, and the news is not good. It's just about all geo-political.

While I'm at it, I'll throw in this little disclaimer: "While not the actual price change that may occur, the numbers will be indicative of what direction prices will go."

*Heating/stove oils show an increase of 2.2 cents a litre.
*Diesel fuel shows an increase of 2.4 cents a litre, and...
*Gasoline shows an increase of 4.4 cents a litre.

Market highlights

Libya output weighs markets
Libyan production has once again been almost fully shut in after hitting close to 700,000 barrels a day in output just last month.
      News out of Libya indicates that the largest output terminal at the Sharara field has been cut off reducing Libyan output to just 250,000 barrels a day.

Syrian attacks raise tensions
Tensions between the US and Russia after the US strikes in Syria are on the increase, helping to bolster oil prices.

Demand up again
US inventory reports from both the EIA and API (American Petroleum Institute) indicate an increased demand in gasoline, even as refinery capacity picks up to meet summer production.
I'll get a better indication of increased demand from tomorrow's EIA inventory data.

IS US shale able to keep pace?
While OPEC and non-OPEC cuts are beginning to take hold, hitting the oil markets with close to 1.8 million barrels less in the markets, US shale production has only responded with an increase in 700,000 barrels increase in domestic production.
     That leaves a gap of 1.1 million barrels of growth that must give investors a possible "window for investment". That window may also be complicated by slower than expected growth in production as former oil workers may not go back to work at their previous jobs as fast as when they first went into the industry.
     Nothing like a good oil price collapse to bring an industry back to its own reality.

That's it for this week!

Regards,

George Murphy

Twitter @GeorgeMurphyOil

Tuesday, April 04, 2017

Price changes for Thursday, April 6th, 2017


Hello to everyone,

Here's what I have for this week's price changes. I expect everyone will share this one!

*Heating and stove oils show an increase of 2,7 cent...s a litre.
*Diesel fuel shows an increase of 2.8 cents a litre, and...
*Gasoline shows an increase of 4 cents a litre.

Market highlights

OPEC to extend production cuts agreement
In what some are considering a surprise to the markets, strong rumours are persisting that show OPEC members in agreement on extending their cuts to production for longer than the six months first agreed to in November.
While the cuts may help to bring prices up, there are some worries amongst members that other non-OPEC producers may not extend their end of the deal, and continue to sign on to self-imposed cuts. Non-OPEC producers agreed to carry out almost 600,000 barrels in production cuts, making total cuts to the market almost 1.8 million barrels a day.

Demand for gasoline on the upswing?
Expectations of a extension to production cuts aren't the only item making news with oil this week.
Expectations of a draw-down on inventories of both gasoline and oil are putting some upwards pressure on prices this week as gasoline shows a draw against inventory at the same time as refinery capacity increased this past week by another two percentage points.
Analysts expect the trend to continue with data from the US Energy Information Administration to be released tomorrow.

US rig counts up again...But can US domestic keep pace?
Oil was also buoyed this week as several key storage areas in the Caribbean are said to have dipped in inventories of crude oil, swallowing up some of the surplus along the US Gulf coast and Eastern seaboard.
The question that needs to be answered now is: Can US domestic drilling and oil output keep ahead, or pick up the pace against cuts made by OPEC? Or, do we see a steady, continued rise in oil prices if and when production meets the level of cuts agreed to in November?
The US rig count increased another 15 rigs last week and should keep rising if oil rises in price.

That's it for this week!

Regards,
George
Twitter @GeorgeMurphyOil

Tuesday, March 28, 2017

Price changes for Thursday, March 30, 2017


Hi to all,

Here's what I have for this week's price changes:

*Heating/stove oil shows a drop of 1.2 cents a litre.
*Diesel shows a drop of 1/10th of a cent a litre, and...
*Gasoline shows an increase of 6/10ths of a cent a litre.

Libyan crude production drops
     Crude oil increased the last two days of the pricing session as Libyan crude production dropped almost 250,000 barrels a day because of disagreements between factions over control of two key oilfields.
     The Sharara and Wafa fields were part of the total source of oil that helped Libya pump out close to 750,000 barrels a day. The removal of the two fields drops total output down to a half million barrels a day, almost one million barrels less than the 1.5 million a day before the revolution started.

API data weighs
     Latest data from the American Petroleum Institute's inventory shows another modest build of 1.9 million barrels, while gasoline shows a "less than expected" draw of just 1.1 million barrels.
     While the EIA data is the chief number I watch, the data on gasoline is showing me that demand remains weak for gasoline.
     Chief number to watch tomorrow will be the refiner capacity number, which should give a better read on any growth in demand, as well as any detected growth in overall US domestic output.

Still watching the numbers!

Regards,

George
Twitter @GeorgeMurphyOil

Tuesday, March 21, 2017

Price changes for Thursday, March 23, 2017


Hi to all,



Short and sweet, here's what I have for this week's price changes:



*Heating & stove oils show a drop of 4/10ths of a cent a litre.

*Diesel fuel shows a drop of 7/10ths of a cent a litre, and...

*Gasoline shows no change in price this week.



Market highlights



API report shows another inventory gain

     While not my source of inventory news that influences my way of thinking, new numbers from the American Petroleum Institute shows another increase in crude oil supply, this time by 4.5 million barrels a day

     Gasoline showed a drop in inventories of 4.9 million barrels, while distillate supplies dropped just over 800 thousand barrels.



Canadian dollar steady

     Up to three days ago, the dollar remained steady against the US greenback, but gained almost a penny against its US cousin in the latter half of the week.

     Oil, in the meantime, lost a dollar US this past pricing session.

     Brent was priced at $40.67 a barrel March 21st last year.



Upcoming provincial budget

     With oil prices close to $51 US a barrel Brent right now, it is obvious that the government will show some added revenue from oil royalties.

     It may be wishful thinking, but it may be time for the government to roll back the heavy increase that was levied onto gas taxes, if only just in part. While government may have thought it "prudent" to increase taxes, it became heavy-handed to levy an added 16.5 cents in added gasoline tax.

     Additional taxes resulted in an increased take as well from HST with the result being a twenty cent a litre hit at the pumps.

     We all could use the break!



That's it for this week!



Regards,



George Murphy

Twitter @GeorgeMurphyOil

Tuesday, March 14, 2017

Price changes for Thursday, March 16, 2017


Hi to all,



Here’s what I have for this week’s price changes, baring in mind that winter blending mat throw off the distillate numbers slightly from the actual that may occur.



*Heating and stove oils show a drop of 3.1 cents a litre.

*Diesel shows a drop of 3 cents a litre, and...

*Gasoline shows a drop of just 2/10ths of a cent a litre.



Market highlights



Focus off distillate turning to gasoline

     If you were a speculator in the distillate market, you didn’t make a pile of money, but you didn’t really lose either. Both ways you look at it, prices were moderate, even to some consumers.

     But it’s time to pull out now, and as you do, you turn to the gasoline markets where, hopefully, you’ll see a rise in demand as spring and early summer comes on.

     So, while consumers should start to see some expected drops in distillate prices here into the summer, those same consumers begin to see some support for gasoline: just part of the reason why no big drop in the gasoline markets this week.

     But don’t expect too much pressure yet, mind you!

     Until consumers see an uptick in demand, expect no immediate growth in gasoline prices this summer. With near-record inventories of gasoline out there this spring ahead of the switch-over from distillate to gasoline, there’s going to be reason for concern for refiners and Big Oil when refineries begin turning out more gasoline for consumption.

     What’s bad for them though, is not necessarily a bad thing for consumers...



OPEC blinks

     OPEC member Saudi Arabia reported today that they secretly increased production upwards from January adding another 260,000 barrels a day to production.

     The Saudi’s produced 10.1 million barrels a day, from 9.8 million barrels a day in January.

     Now, if I were a betting man, I’d put my money on one simple reason: That U.S shale has become a bigger influence on OPEC oil policy than anyone realised. My guess is that, adding a little oil to the markets is an attempt to “taper off” US growth in domestic oil and still allow them to survive.

     It’s a “warning”...

     What OPEC does in the next two months will be determined by what U.S domestic in the next two weeks with domestic production figures when they are released by the US Energy Information Administration.



     That’s it for this week!



Regards,



George Murphy

Twitter @GeorgeMurphyOil

Wednesday, March 08, 2017

Price changes for Thursday, March 9, 2017


Hi to all,



Here’s what I have for this week’s price changes:



*Heating and stove oil to drop by 6/10ths of a cent a litre.

*Diesel fuel to drop by 7/10ths of a cent, and...

*Gasoline to drop by 1.6 cents a litre.



Market highlights



API reports another huge crude inventory build

The American Petroleum Institute recorded yet another huge inventory build, with crude oil stocks growing another 11.6 million barrels to the domestic stockpile.

     Gasoline inventories were reported down in excess of five million barrels, while distillate stocks were also down by 2.9 million barrels.

      All eyes will be on the US Energy Information Administration’s report due to be released around noon Newfoundland time.



OPEC meeting in May

While it’s a long way away yet, it could be the key date that signifies whether OPEC’s member states will carry forth with production cuts, or whether they will answer to the massive growth in U.S domestic production. The US Energy Information Administration is already predicting that US domestic will hit 9.7 million by the end of fiscal 2018. The US has already added half of the total cuts made by OPEC since the end of November and could set itself up to meeting the 1.2 million gain in domestic production within the next four months if oil stays close to $55 US a barrel.

     Question to be answered in May then? Will US domestic production spark OPEC members into opening the floodgates to knock US production again, or does OPEC answer with more cuts?

      For now, it’s “wait and see”.



     That’s it from me this week!



Regards,



George Murphy

Twitter @GeorgeMurphyOil

Tuesday, February 28, 2017

Price changes for Thursday, March 2, 2017

Hi to all,

Here's what I have for this week's price changes. Keep in mind winter blending that may throw off the numbers a little.

*Heating/stove oils show an added 7/10ths of a cent a litre....
*Diesel shows an increase of a penny a litre, and...
*Gasoline shows an increase of 8/10ths of a cent a litre.


Market highlights

US rig count continues upwards
      With the cuts instituted by OPEC and non-OPEC producers at the end of November 2016, along with it came the promise of small shale producers in the US and elsewhere getting back into the market.
      And get back they did, and at such a pace that OPEC countries may have to re-think cuts they made, either cutting deeper or starting another oil price war to finally knock down the competition.
      Last week, numbers for rigs getting back to work increased again, this time by five, while US domestic oil production hit 9 million barrels, an added 600,000 barrels of crude a day since the first week of October.
      Rigs increased by 145 additional units in the field since that same October.

Gasoline finally shows a draw
      US inventories of gasoline showed a modest drop in inventories last week with refiner capacity hitting a record low for the year of 84.4% of total US production.
      While refineries may be down for summer maintenance to refine more gasoline at the end of winter, it remains to be seen where gasoline prices could head when capacity picks up. Even though demand has remained below seasonal levels as compared to other years, if capacity picks up in the next couple of weeks before present inventories are drawn down, then we have the set-up for lower prices at the pumps.
      No demand means lower prices in the hope that consumption picks up.
      It's a ticklish situation refiners and Big Oil finds itself in.

That's it for this week!

Regards,
George Murphy
Twitter @GeorgeMurphyOil

Tuesday, February 21, 2017

Price changes for Thursday, February 23, 2017


Hi to all,



Here’s what I have for this week’s price changes:



*Heating and stove oils show a drop of 2/10ths of a cent a litre.

*Diesel fuel shows a drop of 4/10ths of a cent, and...

*Gasoline shows a drop of 1.8 cents a litre.



Market highlights



Forget a collapse in oil. How about a collapse in gasoline?

   It may sound funny immediately before the spring run-up in gasoline prices that happens starting this time of the year, but data from the US Energy Information Administration seems to be pointing the way towards an extended drop in gasoline-that is, if demand doesn’t pick up soon.



   Data from the EIA indicates that US gasoline inventories are at their highest since the EIA first started recording gasoline inventory data back in 1990.



    Secondly, while gasoline production hangs around 9.5 to 10 million barrels a day, and with refinery capacity down to 85% due to refinery maintenance, even a drop in capacity to 9.3 million barrels a day still shows a build in inventories. Demand for January hung around 8.2 million barrels a day, itself a strange anomaly in a usually busy US economy, blowing up inventories in the US northeast to record levels.



     So, with those factors, with refineries shortly coming back into production, if demand doesn’t pick up in the interim to swallow up bulging inventories, then prices can’t be expected to climb appreciably heading into late spring and early summer.



     Inventory data is going to be the focus the next few weeks.



US rig count climbs again

     While US domestic production remained steady last week hovering close to 8.977 million barrels a day, the US rig count climbed again last week as more small producers got back into the markets. The rig count showed that another ten rigs went back to work last week with oil holding steady and OPEC compliance registering close to 90%.



     That’s it for this week!



Regards,



George Murphy

Twitter @GeorgeMurphyOil