Price changes for Thursday, July 9th, 2020

Hi to all,

Here’s what I have for this Thursday’s price changes:

*Heating and stove oils to increase by 2.7 cents a litre.

*Diesel shows an increase of 2.9 cents a litre, and...

*Gasoline shows an increase of 3 cents a litre.

Market highlights

OPEC production drops again

OPEC production figures are out and, once again there are signs of strong compliance amongst OPEC members.

     Total OPEC production was measured at 22.6 million barrels a day in June, down a good 9.5 million barrels per day after OPEC and OPEC+ members agreed to cuts just two months ago.

     Saudi Arabian production was recorded at 7.53 million barrels a day for the same month.

      Venezuela production, by comparison, was just 360,000 barrels a day.

     Overall, OPEC production is down to levels not seen since the 1991 Gulf War.

Gasoline demand on shaky ground?

While gasoline may be pointing up this week, some signs are starting to appear that may start to point gasoline prices down again.

     With rising cases of Covid-19 starting re-emerge in the US with the opening of the economy, along with holiday and summer get-togethers, gasoline demand is seen to be taking a hit in the coming days and weeks as hospitalisations and stay at home orders start taking effect again as some areas shut down again.

     Areas like Florida, Arizona and California have rising cases in recent days that are leading to second shutdowns of local economies.

EIA inventories

The latest inventory data is out, and crude oil continues to show further drops in stocks with crude dropping 7.2 million barrels.

     Gasoline inventories gained 1.2 million barrels, while distillates dropped 600,000 barrels.

     US domestic production was reported at 11 million barrels a day, no change from the week previous as it seems increased oil prices has given some support to shale producers.

     Refiner capacity was reported at 75.5 percent.

     Meanwhile, the Baker Hughes rig count shows 263 rigs operating in oil and gas fields south of the border, down an even 700 rigs for the same time period last year.

That’s it for this week!

Regards,

George Murphy

Twitter @GeorgeMurphyOil