Hi to all,
Here’s what I have
for this week’s price changes:
*Heating and stove
oils show a drop of 3.4 cents a litre.
*Diesel shows a
drop of 2 cents a litre, and...
*Gasoline shows a
drop of 1.9 cents a litre.
Market highlights
Market speculators
focus of U.S domestic output
The retreat in oil
price this week may be blamed by some on the fall of the stock market
yesterday, but that’s not necessarily the case...
Stocks recovered the next day in the market correction, but oil still showed a
retreat in today’s trading with strong indications that traders were focused
more on the growth in U.S domestic output, due to hit ten million barrels a day
either this week, or next.
The mythological number needs just 80,000 barrels to hit the mark.
That number will probably be achieved in short order with the addition of
another seven rigs in the overall U.S rig count on Friday that shows a steady
growth of smaller producers getting in while oil prices are up.
The next few months are going to be interesting to
watch as oil prices try to strike a new balance of new, smaller shale producers
trying to get a fair price against the former OPEC super oil power in the
markets. If oil goes low, OPEC loses as well as smaller producers and oil
instability will result.
Prices will be in flux until then with more risk to the downside as chances of
outside factors influencing OPEC pricing decisions become moot with additional
U.S capacity.
Market focuses away
from heating/stove oils
With February comes
the March buying contract and thoughts of traders switch from heating, stove
oils and other distillates like Diesel to the promise of warmer spring
weather and strength in demand for Gasoline.
Often this time of year, what becomes more noticeable in the price changes is
the fact that distillates are dropping more this week than Gasoline, a sure
sign that relief from winter is on the way if not because of anything else but
the promise of spring.
While numbers there are dropping, note some support for gasoline as the drop
this week shows some sign of “strength” as the drop is not so prevalent.
That’s it for this
week!
Regards,
George Murphy
Twitter
@GeorgeMurphyOil
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