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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!

Twitter @GeorgeMurphyOil

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