Hi to all,
Here’s what I have
for this week’s price changes:
*Heating and stove
oil to increase by 1.7 cents a litre.
*Diesel to increase
by 1.6 cents a litre, and...
*Gasoline to
increase by 1.8 cents a litre.
Market news
Markets continue to
tighten supplies
Crude oil prices
continued to increase this week as markets were seen to tighten supplies as
Saudi Arabian cuts to production have started, with the Saudi’s promising to
cut an additional one million barrels of production a day that started February
1st.
However, markets have been watching the possibility of another developing
situation where the Saudi’s may lose market share as others jump in to fill the
need left open for oil by the Saudi cut. Other oil producers like Guyana and US
shale producers could be set to increase production to fill the gap immediately
left by the OPEC country that left the markets with a shortfall of oil for the
next two months.
The Saudi’s are set to keep production down until the end of March 2021.
Goldman Sachs
increases estimates
Goldman Sachs
expects oil consumption to have a robust rebound to at least 100 million
barrels a day by the end of August, back near levels not seen since the start
of the pandemic.
According to Goldman Sachs, oil supplies faced a deficit of close to 2.5
million barrels a day in the last quarter of 2020 that helped set prices for
crude in the upwards direction. The only factor that could limit to forecast on
future demand are new outbreaks of Covid-19.
US crude oil
inventory report
The latest Energy
Information Administration inventory report showed another drop in crude oil
inventories last Wednesday as refiners continued to maintain capacity levels
above the eighty percent mark for the fifth week in a row. Capacity was
reported at 81.7 percent that maybe indicative of slowly returning demand.
Gasoline inventories were reported up by 2.5 million barrels, while distillates
were down 800 thousand barrels.
US domestic production was down 100 thousand barrels a day to 10.9 million
barrels a day.
That’s it for this
week!
Regards,
George Murphy
Twitter
@GeorgeMurphyOil
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