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
1 comment:
Is that a typo or is gas supposed to go down 10.4 cents per liter?
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