Hi to all,
Here’s what I have
for this week’s price changes:
*Heating and stove
oil to increase by 2.4 cents a litre.
*Diesel fuel also
to increase by 2.4 cents a litre, and...
*Gasoline to
increase by 2.7 cents a litre.
Market highlights
*Middle East
tensions continued to weigh
on the markets this past week as Israel and Iran stepped up their tit-for-tat
with Israel launching attacks against Iranian positions in Syria.
*Support for higher
oil prices also comes from
collapsing production in Venezuela as production from the South American OPEC
member has fallen from 2.1 million barrels a day in January 2017 to April
2018’s production of 1.43 million barrels a day. While demand has risen hand in
hand with OPEC production cuts, production from Venezuela has fallen well below
their own production from years back, helping to erase part of the world glut
of oil.
*OPEC compliance continues to be near a hundred percent
as total OPEC production cuts have steadily fallen since the implementation of cuts
in November 2016 to support oil and erase the glut of oil on the markets. Oil
demand for the last three months has actually been averaging around 31.93
million barrels a day. Only Nigeria has reported an increase in production so
far this month.
What is remarkable this time around is the fact that all members have not
cheated on quotas as they have in other times of cuts which makes rising oil
prices more amazing to watch.
Watching:
*Watching the U.S rig count. Last week showed the U.S rig count increase by ten
rigs as a sign of some drillers entering the markets.
*U.S
domestic production increased by 91,000 barrels this past week as producers
entered the fields and added to production that has averaged 35,000 barrels a
week increase the last few years. There will be new inventory data released
next week which may show further strong growth in domestic production.
*U.S inventory data showed a drop in crude and gasoline inventories with both
showing drops of 2.2 million barrels. New inventory data comes out Wednesday at
noon Newfoundland time.
That’s it for this
week!
Regards,
George Murphy
Twitter
@GeorgeMurphyOil
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