Hi to all,
Here’s what I have
for this week’s price changes:
*Heating, stove oil
and Diesel all show an increase of 2.2 cents a litre.
*Gasoline shows an
increase of 2.3 cents a litre (5.6 on summer gasoline)
I don’t know if
summer gasoline is on the markets yet, so that’s why I’m putting it there, but
not going with it this week. I believe it comes into effect at the end of the
month.
Market highlights
Oil still rising.
Refined prices too.
They’re not at
their old record highs ever recorded yet, but the after-effects of the Texas
outages two weeks ago are readily apparent in the latest EIA report, and that’s
reflective of the same pricing we saw back when Hurricane Katrina hit back in
2005.
The EIA reported refinery outages that amounted to close to five million
barrels a day in production removed from the markets that has continued to
drive up prices at the pumps.
In 2005, refinery outages amounted to a loss of production of one third of US
refining capacity (5.6 of 17 million barrels)and took a daily production of 2.2
million barrels a day of oil off the markets.
Prices during the week of Katrina hit $1.48.1 a litre in St. John’s with oil at
$65 US a barrel. The all-time record here was $1.49.6 set in September of ’08
when hurricanes again ravaged to Gulf of Mexico.
The Texas weather events of two weeks ago now took almost the identical
refining capacity off the markets with the US EIA reporting that capacity
dropped from 82 percent to 56 percent during the shutdown and removed
temporarily about three million barrels a day in crude oil production offline.
The next EIA report is due on Wednesday at noon and will give a better
indication of how long these prices will last, and how much capacity will have
returned-if any this week.
OPEC delays
increases to production
OPEC, in a surprise
move to most, delayed any increases to quotas and production by announcing that
increases will be held back until April month, instead of March, leaving oil
prices to go nowhere but up.
Oi prices briefly hit $71 US as another attack against the Ras Tanura
facilities in Saudi Arabia also temporarily rattled the markets.
Expectations were that Saudi Arabia would begin adding their million barrel per
day cut back into the markets.
The only exceptions were to allow Russia and Kazakhstan to increase daily
production to meet their won domestic needs.
On average this week, oil prices increased by $5 US a barrel mainly as a
reaction to the OPEC move.
EIA inventory
report
As expected, the
latest EIA inventory report reflected the damage caused by the Texas weather
events.
Latest figures show an increase in crude oil inventories adding a record 21.6
million barrels a day as refinery capacity dropped to 56 percent due to
refinery outages. Crude supplies went up as a result.
Gasoline inventories dropped 13.6 million while distillate inventories dropped
9.7 million barrels as refineries were reported offline.
That’s it for this
week!
Regards,
George Murphy
Twitter
@GeorgeMurphyOil
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