Tuesday, March 19, 2019

Price changes for Thursday, March 21st, 2019


Hi to all,



Here’s what I have for this week’s price changes. Keep in mind that winter blending is still in effect:



*Heating and stove oil show a drop of 1.2 cents a litre.

*Diesel fuel shows a drop of 1.8 cents a litre, and...

*Gasoline shows an increase of 1.8 cents a litre.



Refiners still offline

While refiner capacity is still lower than normal, inventories of gasoline are under pressure as gasoline stocks are not being replaced as readily as they would be if capacity was up.

     With capacity down to 87 percent, there’s still about six percent of production not entering the markets that probably won’t return until refineries come back from seasonal maintenance.

     I’m watching inventory numbers to see when refineries come back, that should bring some moderation to gasoline as the days go on.



OPEC waits until June for further cuts on production

OPEC has announced it will delay a meeting set for April that would have included a decision to extend cuts, to June, adding more speculation that the group is relatively happy with the performance of oil in response to cuts made in December.

     OPEC believes that the cuts are successfully taking a bite out of a world glut of oil and matched with news March 14th that Venezuelan production dropped by another 142,000 barrels in February, prices have been reasonably stable for the group.

     Venezuelan production is now a rough one million barrels a day.



Distillate prices worth watching

As the International Maritime Organisation deadline of January 1st, 2020 comes close, it’s worth noting that there is a predicted shortfall of “clean distillates” that could play into the markets, raising prices for distillate product like diesel fuel, heating and stove oils.

New IMO 2020 regulations calling for lower sulphur content in marine diesel fuels is causing some speculators out there to think about the availability of distillates. New regulations are setting new sulphur levels from 3.5 percent down to a half percentage point by January 1st of 2020 to combat carbon emissions. Some wonder if the diesel, heating and jet fuel markets will also be under added pressure in pricing as a result even though the new regulations affect marine diesel users, potentially the largest user group next to airlines and consumers.



Federal budget goodie

While I haven’t gone fully into the budget, one detail did stand out to me as a consumer: that the federal government will be allowing for a $5000.00 tax credit for electric or hydrogen fuel cell vehicles under the price of $45,000.00.

     Just might be helpful to those of you who may be looking for that “alternative”.



That’s it for this week!



Regards,



George Murphy

Twitter @GeorgeMurphyOil

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