Last weeks miss is this weeks hit…
Consumers will see price increase to gasoline this Thursday
Media release
Conception Bay South, May 20, 2008- Consumers in Newfoundland and Labrador will face the inevitable this coming Thursday morning when they will experience another increase at the pumps.
What consumers will see
“Consumers barely dodged the increase last week. Numbers were so close that they fell within the margin of error that I work with and that’s why we made a price increase warning. This week, there is no mistaking that there is going to be an increase at the regular price setting. Numbers are still falling close to what we had last week, of 3.9 or 4.0 cents per litre up at the pumps. That’s with twelve days reporting out of a possible 14 needed to get the final numbers.
“Heating and stove oils are showing an added 65/100ths of a cent up and that may be pointing the way of diesel fuels as well. We’re still not seeing the substantial drop in distillate prices in the non-demand season as in other years and that should be very concerning for those using distillates for winter heating sources.
Why prices will be going up
“Market volatility is still playing heavy in the markets this last two weeks. Heavy trading in commodities against a lower U.S dollar continues to be a factor in oil and its related refined commodities. Distillates, as of last week, are still showing an increase in demand over the same timeframe last year, of close to one per cent. Of course, we still have the same geo-political conditions still playing themselves out in the markets as well and that’s besides the various disruptions and threats to supply. While refiner capacity increased last week, low reported profit margins are not enticing refiners to get back into the production of gasoline while gasoline itself, shows a drop in consumer demand by .2 per cent ahead of the traditional start of the US summer driving season. The big news this week however, is that heating and stove oils continue to show an increase in price while we enter the non-demand season and this should be a worry to those users of fuels for the coming winter. If we don’t start to see a drop in demand numbers there along with a corresponding drop in spot prices, we are going to be in big trouble.
Some changes made to the Gas and Oil Update
We have made some changes that will make it easier for consumers to obtain our information. Consumers only have to go to www.gasandoil.blogspot.com and use the subscribe option to get the ‘Heating and Gasoline Update’ delivered to their inbox. I found that it was simply too hard to get everyone to send you an email back when their email address had changed. This will make it easier to do the administration of good versus bad email addresses that has long been a problem. I hope that the consumers of the province avail of the service as it is a free service to consumers.
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For more information, contact;
George Murphy
Group researcher/Member
Consumer Group for Fair Gas Prices
Tuesday, May 20, 2008
Thursday, May 15, 2008
How it all worked out...
I guess by the time you all drop in on this note, you will have already heard where the numbers went; mostly up. I guess we dodged a bullet when gas didn't move as I thought it would, but how close was it in the end?
From my media friends at VOCM, I got details of the hit on heating and stove oils and, as it turns out, with seven days now reporting here, I was out by something in the order of 3/100ths of a cent. My final number aloowed for an increase of 7.71 cents. That means that the decrease we all got from the removal of "jet" from the summer mix, was eradicated in one stroke of the pen.
What's worse is that our fishers and transportation sectors got the perverbial kick in the teeth overnight with an allowable 9.2 cents a litre increase to diesel pricing. That's why I say in my releases whenever I talk about the heating/stove oil numbers that "the number may also be pointing the way that diesel will also be going", in this case, UP...
Gas was a little different as the volitility of the markets got to me on this fuel.In the end I had an allowable of 4.1 cents a litre, if you include taxation, or 3.6 without the tax component. The interrupter works on the basis of a four cent a litre movement up or down as measured over seven days.
I usually call my shot with five days reporting so everyone can be a step ahead, particularly when it comes to heating and stove oils and to give the media a chance to report and get the word out to everyone...
My margin for error is 3/10ths of a cent and, with the volitility I figured that I would get the word out on a chance increase in case I might be off just a little; in this case by that extra 1/10th of a cent that would have moved my numbers up to four cents even on gasoline. Guess I "missed it by that much".
Hence, we dodge a bullet for this week with pricing for gasoline still on track for a possible 3.6 cent a litre plus taxes increase coming for next week at the regular setting of prices.
I just hope no one was inconvenienced by my call on this one.
Oh well, it's off to bed and call Randy Simms in the morning!
Sometimes, a tenth of a cent can ruin you...lol
Regards,
George Murphy
Tuesday, May 13, 2008
Another kick in the personal economic teeth
Numbers warrant an increase to heating/stove oils…Again
News release
Conception Bay South, NL, May 13, 2008- Unless divine intervention sets into the markets this week, and soon, consumers in Newfoundland and Labrador will experience the biggest weekly hike in heating and stove oil pricing that they have ever seen for this time of the year.
“Numbers for heating and stove oils show an allowable 7.4 cent a litre increase coming this Thursday morning as these numbers fall well within the guidelines set for early interruption of pricing, that’s also with five days out of a possible seven days of data needed for interruption to occur. Being a part of the distillate group, there is a possibility that diesel may also get hit.
“Gasoline now is showing an allowable of 3.5 cents a litre but, the way those numbers have been going as of late, it wouldn’t surprise me if pricing did move early. Those numbers are just outside of the guides for interruption but, just by a minimum. There is still a slight chance that they won’t albeit; I’m still hitting the pumps myself on Wednesday night.
“Continued heavy investment in commodities ahead of the dropping US dollar, supply disruptions and the continuing geo-political situation are to blame as they always have been. I just find it incredible that heating and stove oil pricing will increase again, all during the non-demand season. Right now, I am looking at a 95.00 cent a litre cost price where there was a 55.00 cent a litre cost last year for this time period. It’s early but there are the signs of big trouble on the heating and stove oil fronts this winter coming.”
-30-
For more information, please contact;
George Murphy
Group researcher/Member
Consumer Group for Fair Gas Prices
Numbers warrant an increase to heating/stove oils…Again
News release
Conception Bay South, NL, May 13, 2008- Unless divine intervention sets into the markets this week, and soon, consumers in Newfoundland and Labrador will experience the biggest weekly hike in heating and stove oil pricing that they have ever seen for this time of the year.
“Numbers for heating and stove oils show an allowable 7.4 cent a litre increase coming this Thursday morning as these numbers fall well within the guidelines set for early interruption of pricing, that’s also with five days out of a possible seven days of data needed for interruption to occur. Being a part of the distillate group, there is a possibility that diesel may also get hit.
“Gasoline now is showing an allowable of 3.5 cents a litre but, the way those numbers have been going as of late, it wouldn’t surprise me if pricing did move early. Those numbers are just outside of the guides for interruption but, just by a minimum. There is still a slight chance that they won’t albeit; I’m still hitting the pumps myself on Wednesday night.
“Continued heavy investment in commodities ahead of the dropping US dollar, supply disruptions and the continuing geo-political situation are to blame as they always have been. I just find it incredible that heating and stove oil pricing will increase again, all during the non-demand season. Right now, I am looking at a 95.00 cent a litre cost price where there was a 55.00 cent a litre cost last year for this time period. It’s early but there are the signs of big trouble on the heating and stove oil fronts this winter coming.”
-30-
For more information, please contact;
George Murphy
Group researcher/Member
Consumer Group for Fair Gas Prices
Saturday, May 10, 2008
Disaster in the making
Air Canada hikes airfares ahead of tourism season
Media release
Conception Bay South, NL, May 10, 2008- Air Canada raised fuel surcharges on all fares yesterday and that could prove a back-breaker for the Newfoundland and Labrador tourism sector this year.
“The move by Air Canada follows the major United States airlines that raised their airfares as a result of higher fuel costs. American, United and Delta airlines all raised their airfares by $20.00 US on all flights bringing total fuel surcharges to those companies that add up to near $130.00 US,” Murphy said. “That is far less than what Air Canada will be charging in total for flights that exceed 1600 kilometers. As far as I can tell, Air Canada will be charging close to $180.00 in fuel surcharges alone and the government, no doubt, will also get a piece of the price of the extra costs on the ticket. I think Air Canada overdid the surcharge.”
“The federal government, along with the provinces, is going to have to do something big here to prevent a disaster from falling on our tourism sectors in this country this year and it’s going to have to be done now. Here in Newfoundland and Labrador, we depended heavily on air traffic to bring visitors here and now they face the huge costs to get here as a result of being far away from most major centers. If I come from Toronto, I will be subject to the additional $120.00 in fuel surcharges that Air Canada brought in yesterday. Can the federal government address the tax on airfares?
“We’ve asked government here to address high road taxes. If our visitors cannot afford to fly, then perhaps with a little incentive like dropping some of the gasoline taxes, they could promote more drive-in traffic into the province. God knows the tourism sector could use the help now as Big Oil continues to reap the rewards of the high cost of oil.”
-30-
For more information, contact;
George Murphy
Consumer Group for Fair Gas Prices
gasprices@hotmail.com
I dunno people...I talked about this possibility just before Christmas this year and government still didn't act...I guess they'll be in panic mode now.Going to cost some flying back and forth
Ft. Mac a fortune now...I just hope a lot of you booked early like I recommended.
Air Canada hikes airfares ahead of tourism season
Media release
Conception Bay South, NL, May 10, 2008- Air Canada raised fuel surcharges on all fares yesterday and that could prove a back-breaker for the Newfoundland and Labrador tourism sector this year.
“The move by Air Canada follows the major United States airlines that raised their airfares as a result of higher fuel costs. American, United and Delta airlines all raised their airfares by $20.00 US on all flights bringing total fuel surcharges to those companies that add up to near $130.00 US,” Murphy said. “That is far less than what Air Canada will be charging in total for flights that exceed 1600 kilometers. As far as I can tell, Air Canada will be charging close to $180.00 in fuel surcharges alone and the government, no doubt, will also get a piece of the price of the extra costs on the ticket. I think Air Canada overdid the surcharge.”
“The federal government, along with the provinces, is going to have to do something big here to prevent a disaster from falling on our tourism sectors in this country this year and it’s going to have to be done now. Here in Newfoundland and Labrador, we depended heavily on air traffic to bring visitors here and now they face the huge costs to get here as a result of being far away from most major centers. If I come from Toronto, I will be subject to the additional $120.00 in fuel surcharges that Air Canada brought in yesterday. Can the federal government address the tax on airfares?
“We’ve asked government here to address high road taxes. If our visitors cannot afford to fly, then perhaps with a little incentive like dropping some of the gasoline taxes, they could promote more drive-in traffic into the province. God knows the tourism sector could use the help now as Big Oil continues to reap the rewards of the high cost of oil.”
-30-
For more information, contact;
George Murphy
Consumer Group for Fair Gas Prices
gasprices@hotmail.com
I dunno people...I talked about this possibility just before Christmas this year and government still didn't act...I guess they'll be in panic mode now.Going to cost some flying back and forth
Ft. Mac a fortune now...I just hope a lot of you booked early like I recommended.
Wednesday, May 07, 2008
Oil keeps rising, so does the price of gas
Consumers to get dinged at the pumps again
Media release
Conception Bay South, NL, May 7, 2008- Consumers in Newfoundland and Labrador will notice a jump at the pumps again tonight, that’s according to George Murphy, group researcher and member of the Consumer Group for Fair Gas Prices.
“Consumers in Newfoundland and Labrador can expect to see another increase at the pumps tonight as numbers are showing an allowable two cents a litre over twelve days of data recorded. While stove oils show a very slight decline, the number is too low to note any real change in pricing and that may be an indicator that there will be a slight adjustment in heating and diesel oil pricing,” said Murphy.
Reasons why prices will go up
“Continued supply disruptions in Nigeria and the promise of Kurdish attacks against Northern Iraq oil infrastructure as revenge against the United States for sharing satellite intelligence with Turkey, drops in production in Russia and Mexico and heavy investment in related fuel commodities continues to dictate what consumers will pay at the pumps. A run-up in oil driven mainly by speculators continues to put upward pressure on oil pricing as a result of investors hedging against the drop in the U.S dollar.
New investment laws needed
“There’s a fine line between investment in the actualities of the oil markets and the reality of the markets that has been costing people so much. Using important consumer products that have faced no appreciable increase in demand has become the norm in the markets as of late. The simple laws of supply and demand have been thrown to the wind. Food costs have gone up merely on speculation that they will be of more interest to companies for the manufacture of bio-fuels rather than for the basics of human consumption and this has already caused problems in other countries. The high cost of diesel has resulted in other added costs to foodstuffs. It is only a matter of time before we see more food costs passed to the consumer. What investors are doing instead of speculating on the actualities of the markets is, in fact, speculating on starvation. They’re betting that food as a fuel is more important than food for consumption.
Time for a new National Energy Program to protect Canadians?
“The Government of Canada should certainly be looking at the possibility of protecting the Canadian consumer from outside sources of pricing influence knowing that we are self-reliant in our resources of oil. We should, as a country, institute a new National Energy Policy that protects Canadian consumers and industries like the fishery from outside influences like OPEC. If they can sell gasoline in downtown Tehran for 11 cents a US gallon, then we can sell our own refined product to Canadians for a Canadian price.
Heating oil users will face problems next winter
“I have not noted any appreciable drop in heating oil prices and that remains a worry as consumers usually start to see a retreat in distillate pricing during the spring. That trend has yet to happen and the promise is there to see higher than normal pricing again next winter. Prices need to see a retreat of almost 50 cents a litre in the coming months to return to some form of ‘normalcy’ in their heating expenses. A lot of people have to jump in here in order to avoid any problems for consumers and to put heating/stove oil pricing back to where they were in 2005.
Food banks will need help
“Heating oil users face a dilemma this coming winter if pricing does not return to more affordable levels. They will again be faced with the challenge of choosing between food and fuel this winter. Food banks can expect to see another increase in traffic if heating oil pricing fails to drop. Numbers here indicate the fact that consumers will face that tough choice as all models show heating/stove oil pricing will be up again this coming winter. Although it is very early to predict the price range, it looks as though consumers can expect to pay close to that $1.00 a litre again if numbers for heating/stove oils fail to retreat.”
-30-
For more information, contact;
George Murphy
Group researcher/Member
Consumer Group for Fair Gas Prices
gasprices@hotmail.com
Consumers to get dinged at the pumps again
Media release
Conception Bay South, NL, May 7, 2008- Consumers in Newfoundland and Labrador will notice a jump at the pumps again tonight, that’s according to George Murphy, group researcher and member of the Consumer Group for Fair Gas Prices.
“Consumers in Newfoundland and Labrador can expect to see another increase at the pumps tonight as numbers are showing an allowable two cents a litre over twelve days of data recorded. While stove oils show a very slight decline, the number is too low to note any real change in pricing and that may be an indicator that there will be a slight adjustment in heating and diesel oil pricing,” said Murphy.
Reasons why prices will go up
“Continued supply disruptions in Nigeria and the promise of Kurdish attacks against Northern Iraq oil infrastructure as revenge against the United States for sharing satellite intelligence with Turkey, drops in production in Russia and Mexico and heavy investment in related fuel commodities continues to dictate what consumers will pay at the pumps. A run-up in oil driven mainly by speculators continues to put upward pressure on oil pricing as a result of investors hedging against the drop in the U.S dollar.
New investment laws needed
“There’s a fine line between investment in the actualities of the oil markets and the reality of the markets that has been costing people so much. Using important consumer products that have faced no appreciable increase in demand has become the norm in the markets as of late. The simple laws of supply and demand have been thrown to the wind. Food costs have gone up merely on speculation that they will be of more interest to companies for the manufacture of bio-fuels rather than for the basics of human consumption and this has already caused problems in other countries. The high cost of diesel has resulted in other added costs to foodstuffs. It is only a matter of time before we see more food costs passed to the consumer. What investors are doing instead of speculating on the actualities of the markets is, in fact, speculating on starvation. They’re betting that food as a fuel is more important than food for consumption.
Time for a new National Energy Program to protect Canadians?
“The Government of Canada should certainly be looking at the possibility of protecting the Canadian consumer from outside sources of pricing influence knowing that we are self-reliant in our resources of oil. We should, as a country, institute a new National Energy Policy that protects Canadian consumers and industries like the fishery from outside influences like OPEC. If they can sell gasoline in downtown Tehran for 11 cents a US gallon, then we can sell our own refined product to Canadians for a Canadian price.
Heating oil users will face problems next winter
“I have not noted any appreciable drop in heating oil prices and that remains a worry as consumers usually start to see a retreat in distillate pricing during the spring. That trend has yet to happen and the promise is there to see higher than normal pricing again next winter. Prices need to see a retreat of almost 50 cents a litre in the coming months to return to some form of ‘normalcy’ in their heating expenses. A lot of people have to jump in here in order to avoid any problems for consumers and to put heating/stove oil pricing back to where they were in 2005.
Food banks will need help
“Heating oil users face a dilemma this coming winter if pricing does not return to more affordable levels. They will again be faced with the challenge of choosing between food and fuel this winter. Food banks can expect to see another increase in traffic if heating oil pricing fails to drop. Numbers here indicate the fact that consumers will face that tough choice as all models show heating/stove oil pricing will be up again this coming winter. Although it is very early to predict the price range, it looks as though consumers can expect to pay close to that $1.00 a litre again if numbers for heating/stove oils fail to retreat.”
-30-
For more information, contact;
George Murphy
Group researcher/Member
Consumer Group for Fair Gas Prices
gasprices@hotmail.com
Thursday, April 24, 2008
"The Perfect Storm scenario"
Why prices might even crash...
I know...
Seven days showed a 3.9 cent a litre increase and still a decrease for stove and heating oils. Guess they were close...
It made me sick too, just to look at the pump as I drove by. I didn't need any as I topped it all off the night before...
It's my way of putting the screws to Big Oil before they get to do it to me later in the week when I'm back on "w" for "walk".
But, if the storm in the markets has anything to do with it, we just might see a drop at the pumps before the summer driving season hits and we hit the "expected' spike in prices for the summer.
You shouldn't take for granted everything these professional oil analysts are thinking. You might "get use" to what they say and then you'll have to pay the piper.
And that's the reason for this particular post; because I don't take what they're shoving at me for the truth. Matter of fact, I think there's something that the "investor" is not telling you...
If the refining industry is having such a tough time with their refiner margins and oil is becoming hard to acquire because of price, then it must be obvious to the consumer that they are "purposely" keeping capacity down in order to support the retail price to the consumer, right?
If that is true, and prices have climbed to the point that overall demand is being broken and people start to conserve, then that creates a build in inventories right?
Then the following must be true...
Less demand means less need for refined product which in turn means less refining. That would also mean a drop in demand for the raw crude oil product. We have to note here that crude inventories climbed last week possibly because of part of what we're saying here; that crude simply costs too much to buy by the refiner and inventories were allowed to build in the hope that prices may be impacted...
That means there's evidence of an attempt to support gasoline and heating oil prices by the refiner and Big Oil; a "supported" price...
While the price may indeed be supported, there's not a heck of a lot of return for the investment...
What the markets need to see now, or should I say, the consumer needs to see, is the proof that inventory is building and that demand is being impacted. That may bring down the house of cards that OPEC helped create.
We have already reached a point where Big Oil has hit the Law of Diminishing Returns because of rampant investment in commodities like gasoline and heating oils. consumers here in Newfoundland and Labrador have been hard hit this winter with "above normal" heating oil prices. The elderly and those on fixed incomes as well as pensioners, are at the point where they are buying no more.
They now choose food over heat.
I think they like to call it "energy starvation"...
I think that we're going to start to see investors in distillates lose a lot of money...
One can always live in hope...
Regards,
George
Wednesday, April 23, 2008
Six days now reporting...
Little change expected in predictions
Six days are now in and the data has only changed slightly. Numbers are still showing a decrease for stove oils and an increase to gasoline pricing Wednesday night in Newfoundland and Labrador.
Heating oils and diesels may go the same way as stove oils but the last couple of adjustments showed heating oils increasing moreso than stove oils. That could translate into little change in the heating oil or diesel price.
Stove oils now show an expected decline of 1.46 cents a litre from yesterdays 1.55. Gasoline is showing a steady 3.7 up on a litre for Wednesday...
As an afterthought, I do an awful lot of thinking while I'm at this...
If 1) it's possible for heating and stove oil product to become so expensive that Big Oil just may ruin its own market for the commodity, and
2) We find that people can't keep themselves warm as a result of heating oils being unaffordable and people want to make the switch to electricity, then
3) Obviously we're going to presure our own sources of energy like electricity as the most beneficial next to wood some might say, then we have another problem developing for the short-term future, and here it is...
To me there may be trouble down the line for our supply of electricity, particularly on the island portion of the province. The question has to be asked about the supply-demand balance of electricity if we find a lot of people are going to switch from oil-based products to electricity.
With those thoughts in mind, here's a few questions for you all to ponder...
1)Do we have the capacity on the island portion to handle the increased demand in electricity if people/consumers switch?
2) Why haven't we heard of Labrador residents being covered in the provincial energy plan, particularly on the coast in areas that face electricity generated by diesel generation?
3) Natural gas is being eyed closely as an alternate source of energy again in the United States as heating oil pricing has skyrocketed. Does our government still have plans to ship out our natural gas to places far away rather than supply our own people with it first?
4) If more people are going to fall back on wood, what is the government going to do as regards to placing some constraints on wood harvesting for "personal consumption"?
5) How about forest replantation/silviculture programs for the long term?
I could go on but, I'll leave it at that for now...
regards,
george
Tuesday, April 22, 2008
Oil keeps climbing, so does gasoline
Consumers to get dinged at the pumps again this week
News release
Conception Bay South, NL, April 22, 2008- Consumers in Newfoundland and Labrador haven’t seen the end of price increases this regulation period as prices for gasoline are expected to take another hit, that’s from George Murphy of the Consumer Group for Fair Gas Prices.
Gasoline to increase
“Consumers of gasoline will most likely see another 3.7 cents a litre at the gas pumps this coming Thursday unless there’s something that I don’t know. Five days out of a possible seven show that consumers are going to take it on the chin as they have been doing in other regions of the country as gasoline sets almost daily records in trading,” said Murphy.
Heating and stove oils to decline
“Stove oils show a small decline of 1.5 cents a litre which may be indicating stagnation in the rise of distillates. It may have hit its peak with the end of winter and the continuing bad economic news. Inventories of distillates increased only slightly in last week’s inventory report. Distillate demand along with demand for jet fuels which are used in winter heating oils, are both showing a drop in demand so, these may be the signs that we’ve been waiting for; that prices will soon start to drop for heating commodities. They had better because they’ve become unaffordable to most people now and we’re looking at a record peak for heating and stove oils! Look for prices in heating oils to stall if not decrease.
Reasons for price changes
“Last week saw early interruption in pricing. Supply disruptions, including an attack on a Japanese tanker off the coast of Yemen, lower refiner capacity and draw-downs on both oil and gasoline inventory, continue to impact the price we’re seeing at the pumps again this week. I almost wonder if Big Oil is deliberately trying to cut back on production of refined product in order to control the price. Even though there remains good demand in some aspects of heating oils this past winter for example, refiner capacity remained at a low. That’s also reason that we never saw good builds in gasoline inventory this past winter.
Consumers of heating oil face tough questions
Heating oil consumers have hit a roadblock in pricing. Not only have record prices hit for heating and stove oils, it has also become almost unaffordable for some companies to deliver and some are saying that they can’t deliver anything less than $200 worth of product.
Consumers can not be expected to be held to account for buying contracts if the terms of their contracts have been changed by their company. Some buying arrangements and service/warranty agreements require that consumers have to buy heating and stove oils off that particular company. Consumers are advised to shop around if their company of choice can no longer deliver fuel for less than the stated amount that has been changed by that company.
Government also needs to pursue new retrofit programs that also include assistance in petroleum users switching from petroleum products to electricity or other forms of heating if they so wish. Government has to look at this as a viable alternative as it also is in keeping with helping to lower carbon emissions from houses and other heating/stove oil users.
Budget Day coming
Consumers of petroleum products should pressure their government now in order to pursue tax breaks from petroleum products. Whether it is the pursuit of the removal of taxes off all forms of heat or a break in gasoline taxes, all petroleum products have reached a point where we deserve cuts to taxes applied to petroleum products. Government on both the federal and provincial level has made a huge amount of royalties off oil and we deserve the break.
-30-
For more information, contact;
George Murphy
Group researcher/Member
Consumer Group for Fair Gas Prices
Consumers to get dinged at the pumps again this week
News release
Conception Bay South, NL, April 22, 2008- Consumers in Newfoundland and Labrador haven’t seen the end of price increases this regulation period as prices for gasoline are expected to take another hit, that’s from George Murphy of the Consumer Group for Fair Gas Prices.
Gasoline to increase
“Consumers of gasoline will most likely see another 3.7 cents a litre at the gas pumps this coming Thursday unless there’s something that I don’t know. Five days out of a possible seven show that consumers are going to take it on the chin as they have been doing in other regions of the country as gasoline sets almost daily records in trading,” said Murphy.
Heating and stove oils to decline
“Stove oils show a small decline of 1.5 cents a litre which may be indicating stagnation in the rise of distillates. It may have hit its peak with the end of winter and the continuing bad economic news. Inventories of distillates increased only slightly in last week’s inventory report. Distillate demand along with demand for jet fuels which are used in winter heating oils, are both showing a drop in demand so, these may be the signs that we’ve been waiting for; that prices will soon start to drop for heating commodities. They had better because they’ve become unaffordable to most people now and we’re looking at a record peak for heating and stove oils! Look for prices in heating oils to stall if not decrease.
Reasons for price changes
“Last week saw early interruption in pricing. Supply disruptions, including an attack on a Japanese tanker off the coast of Yemen, lower refiner capacity and draw-downs on both oil and gasoline inventory, continue to impact the price we’re seeing at the pumps again this week. I almost wonder if Big Oil is deliberately trying to cut back on production of refined product in order to control the price. Even though there remains good demand in some aspects of heating oils this past winter for example, refiner capacity remained at a low. That’s also reason that we never saw good builds in gasoline inventory this past winter.
Consumers of heating oil face tough questions
Heating oil consumers have hit a roadblock in pricing. Not only have record prices hit for heating and stove oils, it has also become almost unaffordable for some companies to deliver and some are saying that they can’t deliver anything less than $200 worth of product.
Consumers can not be expected to be held to account for buying contracts if the terms of their contracts have been changed by their company. Some buying arrangements and service/warranty agreements require that consumers have to buy heating and stove oils off that particular company. Consumers are advised to shop around if their company of choice can no longer deliver fuel for less than the stated amount that has been changed by that company.
Government also needs to pursue new retrofit programs that also include assistance in petroleum users switching from petroleum products to electricity or other forms of heating if they so wish. Government has to look at this as a viable alternative as it also is in keeping with helping to lower carbon emissions from houses and other heating/stove oil users.
Budget Day coming
Consumers of petroleum products should pressure their government now in order to pursue tax breaks from petroleum products. Whether it is the pursuit of the removal of taxes off all forms of heat or a break in gasoline taxes, all petroleum products have reached a point where we deserve cuts to taxes applied to petroleum products. Government on both the federal and provincial level has made a huge amount of royalties off oil and we deserve the break.
-30-
For more information, contact;
George Murphy
Group researcher/Member
Consumer Group for Fair Gas Prices
Monday, April 21, 2008
Not gonna do it...
Numbers tomorrow on more increases to come at the pumps...
Keep an eye to "Gasandoil" tomorrow as I'll have new numbers on where prices will be going.
So far, with only two days out of a possible seven, as prices interrupted last week, I have about three cents a litre on gasoline.
It's a little different for stove oils and that may be painting the way for heating oils and diesels. A slight drop in stove oil numbers of a rough 1.5 cents on a litre.
Short shrift I know, considering it's still a little chilly during the night.Oh well...Big Oil doesn't have to worry about our seniors not being able to afford the heating oils. I guess that's up to the Avalon Mall as "wandering gangs" of seniors are in competition with our younger folk for the spot at the best vido game.
Shame!
See you all in the A.M...
Thursday, April 17, 2008
Rate increase coming from Hydro
Government should absorb any further electricity charges to consumers
Media release
Conception Bay South, NL, April 17, 2008- Consumers in this province should not have to face the heavy financial burden being placed on them with the prospects of higher electricity bills in the coming weeks.
“Consumers in Newfoundland and Labrador are facing a double whammy in higher electricity charges at the same time as getting hit with higher heating and stove oil pricing. To be hit with these costs and get hit with higher electricity costs as a result of higher crude oil pricing seems to be a little asinine in the least, knowing that the province is making huge royalties from offshore oil,” said George Murphy, group researcher with the Consumer Group for Fair Gas Prices.
“Government should take immediate steps to allow Hydro to absorb the higher crude acquisition costs and insulate the Newfoundland and Labrador consumer from these costs. With close to a billion dollars in the treasury from oil royalties this year, it is entirely within the realm of government to do this. The Newfoundland and Labrador consumer owns Newfoundland and Labrador Hydro and should be able to get government to call the shot on this latest increase on their behalf. This time, the government can say ‘no’.
“Labrador residents particularly will be hard hit knowing that the Labrador winter is longer and colder. Electricity users along coastal Labrador, where electricity is generated by diesel, will be particularly hard hit. Government should do the right thing and prevent consumers from paying more as a result of something they have the power to help us avoid. The government should also be taking the concrete steps in getting coastal regions of Labrador wired into the provincial energy plan thusly removing them from wild swings in pricing caused by oil-generation of electricity.”
-30-
For more information, contact;
George Murphy
Group researcher/Member
Consumer Group for Fair Gas Prices
gasprices@hotmail.com
Wednesday, April 16, 2008
Update: Numbers still show interruption possible
Conception Bay South, NL, April 16, 2008- Numbers here still show for interruption on all major fuels tonight. Numbers are still showing that interruption is possible for gasoline as well as stove oils, a major fuel in the distillate group which also includes diesel and heating oils. I would expect those fuels to follow the way of the stove oil numbers if all holds true.
Gasoline still shows an additional 5.2 cents a litre now, while stove oils are now showing 6.4 cents a litre to come into effect tonight. Heating oils and diesels should also closely follow those numbers.
All numbers are now with six days of data instead of yesterdays five days.
Hope all this helps!
regards,
George
Tuesday, April 15, 2008
Numbers show fuel price interruption is possible
Considerable hikes to all petroleum products on the way for Thursday
Media release
Conception Bay South, NL, April 15, 2008- Consumers in the province of Newfoundland and Labrador can expect to be hit with a huge increase to all petroleum products this coming Thursday morning if George Murphy’s numbers are right. The numbers are substantial and could start to prove a bone of contention in this country if they remain high.
How much to expect
“So far this regulation period, we’re looking at five days data that are all showing at least at least a 6.7 cent a litre increase to stove oils and a 5.1 cent a litre increase coming for gasoline. Monday’s market numbers are also up for crude oil which has only enforced those figures. I believe there is a very strong possibility that other commodities like heating oil and diesel will also get to take this hit as they are so closely related to stove oils, being part of the same distillate group of fuels. This morning, crude oil hit a new record of $112.48 a U.S barrel as the U.S dollar continues a slide against other world currencies and that is only enforcing my belief that interruption will happen this coming Thursday morning,” said Murphy.
Consumers could face tough choices
“I don’t think we can predict where this will end now. We have a case where people will start to become energy-starved and will face a bigger problem of affording energy over food. That goes especially for people who are on fixed incomes. What we are witnessing on the markets is an investor’s complete fixation with the money to be made off the petroleum markets and consumers are being faced with some pretty tough choices as a result. If we don’t see a substantial drop-off in spot pricing for heating and stove oils in the next couple of weeks, we will face some serious problems keeping warm next winter and that goes for everyone in the province as some electricity is generated via the burning of petroleum products. This is the time of year when we should be witness to falling heating and stove oil pricing, not increases. It has to break. Prices as high as they are now are not sustainable on anyone’s part! If this trend keeps up we’re looking at the possibility that any heating rebate program just isn’t going to cut it and we’ll have to see government assist people into breaking their dependency on oil-related products.
Reasons for the possible increases
“Oil is up for several reasons. Last week saw considerable draws against U.S inventories, as well as supply disruptions in places such as Nigeria, Mexico and the Middle East. Demand for crude in China is also expected to grow as economic growth is expected to hit 10 per cent for the first quarter of the year.
Canada may to face the tough questions
“I believe that this country is going to have to face the tough question about how we are going to afford to keep ourselves warm if we continue to face high prices for oil-related commodities. If people are no longer going to be able to afford heating oil over food, and farmers begin to invest heavily into energy industry related crops, them we may also face the problem of ever-increasing food pricing. We already are facing mass increases in wheat, corn and other crops on mere speculation. When you start to hit food pricing as other world nations have seen, then we have a serious problem. What is this country prepared to do in the event that we face a continuance of the situation we are witnessing in the world markets now?
-30-
For more information, contact;
George Murphy
Group researcher/Member
Consumer Group for Fair Gas Prices
gasprices@hotmail.com
Considerable hikes to all petroleum products on the way for Thursday
Media release
Conception Bay South, NL, April 15, 2008- Consumers in the province of Newfoundland and Labrador can expect to be hit with a huge increase to all petroleum products this coming Thursday morning if George Murphy’s numbers are right. The numbers are substantial and could start to prove a bone of contention in this country if they remain high.
How much to expect
“So far this regulation period, we’re looking at five days data that are all showing at least at least a 6.7 cent a litre increase to stove oils and a 5.1 cent a litre increase coming for gasoline. Monday’s market numbers are also up for crude oil which has only enforced those figures. I believe there is a very strong possibility that other commodities like heating oil and diesel will also get to take this hit as they are so closely related to stove oils, being part of the same distillate group of fuels. This morning, crude oil hit a new record of $112.48 a U.S barrel as the U.S dollar continues a slide against other world currencies and that is only enforcing my belief that interruption will happen this coming Thursday morning,” said Murphy.
Consumers could face tough choices
“I don’t think we can predict where this will end now. We have a case where people will start to become energy-starved and will face a bigger problem of affording energy over food. That goes especially for people who are on fixed incomes. What we are witnessing on the markets is an investor’s complete fixation with the money to be made off the petroleum markets and consumers are being faced with some pretty tough choices as a result. If we don’t see a substantial drop-off in spot pricing for heating and stove oils in the next couple of weeks, we will face some serious problems keeping warm next winter and that goes for everyone in the province as some electricity is generated via the burning of petroleum products. This is the time of year when we should be witness to falling heating and stove oil pricing, not increases. It has to break. Prices as high as they are now are not sustainable on anyone’s part! If this trend keeps up we’re looking at the possibility that any heating rebate program just isn’t going to cut it and we’ll have to see government assist people into breaking their dependency on oil-related products.
Reasons for the possible increases
“Oil is up for several reasons. Last week saw considerable draws against U.S inventories, as well as supply disruptions in places such as Nigeria, Mexico and the Middle East. Demand for crude in China is also expected to grow as economic growth is expected to hit 10 per cent for the first quarter of the year.
Canada may to face the tough questions
“I believe that this country is going to have to face the tough question about how we are going to afford to keep ourselves warm if we continue to face high prices for oil-related commodities. If people are no longer going to be able to afford heating oil over food, and farmers begin to invest heavily into energy industry related crops, them we may also face the problem of ever-increasing food pricing. We already are facing mass increases in wheat, corn and other crops on mere speculation. When you start to hit food pricing as other world nations have seen, then we have a serious problem. What is this country prepared to do in the event that we face a continuance of the situation we are witnessing in the world markets now?
-30-
For more information, contact;
George Murphy
Group researcher/Member
Consumer Group for Fair Gas Prices
gasprices@hotmail.com
Monday, April 14, 2008
Hate to be the bearer of bad news but...
Newfoundland and Labrador consumers will most likely take the hit from the latest round of increases in oil last week but we'll probably not know for sure until tomorrow.
With the first two days of the regulatory period out of the way, stove oils are showing an allowable of 5.03 upwards. That could be pointing the way for heating oils and diesel as well.
Gasoline shows an allowable increase of 3.88 cents and that falls within the 3/10ths of a cent margin for error I use putting the number slightly over the four cents needed for interruption of fuel prices...
I'll know more by Tuesday afternoon so, keep an eye for a posted release and your ears to the media...
Sometimes it just sucks to be on the receiving end of oil doesn't it?
Regards,
George
Wednesday, April 09, 2008
Latest EIA survey confirms our thinking
Petroleum stocks down on three fronts this week...
The latest report from the Energy Information Administration today seems to confirm our worst fears; that there is a steady decline in inventories of crude and distillate and that we can expect pricing here in Newfoundland and Labrador to remain around the $1.22 to $1.37 range for the better part of the summer.
As a matter of fact, my numbers are also pointing at the figure of $1.30 at summertime peak this coming first week of July before things moderate. That doesn't include outside factors like Hurricane Syndrome.
Numbers in the report are all down again this week while, refiner capacity is at a near historic low of 83 per cent, a level I haven't seen since I started predicting pricing movements.
See the report from the EIA on last weeks oil inventories here:
Here's the kicker though...
In the report, we also see that gasoline demand is also projected to drop as recession factors and consumer fears kick in. Gasoline demand has been dropping so much so, that it is a mere 3/10ths of a percentage point over last years numbers for the same timeframe.
Distillate demand along with jet fuel usage has also remained flat for the past week compared to last years numbers so, consumers can expect to see prices for heating and stove oils start to drop from here on in.
They better start soon!
If pricing fails to fall now rather than later, there is no doubt that consumers again will be paying new records for heating and stove oils next year possibly making heating oils even more unaffordable than it already is now.
See the highlights report here:
In the meantime, don't forget to hit the pumps on the way home tonight. My numbers now show an expected 3.1 cents a litre at the pumps tonight.
You just might want to pass the word along...
Tuesday, April 08, 2008
Still no relief on the heating front
Heavy commodity investment still forcing prices upwards
News release
Conception Bay South, NL, April 08, 2008- Market conditions are still putting upwards pressure on petroleum commodities and that means ‘prices up’ for gasoline along with stove oils this week, that’s according to George Murphy of the Consumer Group for Fair Gas Prices.
“Continued heavy investment into commodities like heating, stove oils and gasoline is putting upwards pressure on those petroleum products as a hedge against the U.S dollar. We’re also dealing with a huge drop in refiner capacity as refiners turn their attentions towards gasoline as we get out of the winter heating season. All this means that consumers here in the province of Newfoundland and Labrador will likely see increases to all petroleum pricing again this week.
What consumers can expect
“All numbers are based on twelve days data out of a possible fourteen that is used to set pricing. It appears that gasoline will see the bigger increase. Numbers there show a possible 2.8 cent a litre hike at the pumps while stove oils will only see a 3/10ths of a cent hike in price. The stove oil number may be a sign that we’re near the peak in pricing for heating oils as well as investors and refiners turn their attention to gasoline for the run-up to the summer driving season. The actual that may occur with heating and stove oils could be higher with the other days of data unavailable yet, although I don’t think those numbers will be significant to radically change things at this point.
Warning for next winter
While pricing for heating and stove oils are both expected to back off from records in short order, those same numbers have to begin to show a substantive drop between now and the fall if we are to avoid any problems with consumers keeping themselves warm next winter. Right now, heating and stove oil pricing is a record 28 cents a litre higher than last year while gasoline is roughly 7 cents a litre higher for the same timeframe. I would advise government now rather than later, to get rebate and retrofit programs ready to catch those who will need it, and that could be everybody next year if pricing does not fall back to more affordable levels between now and the fall. A rebate of $300 to consumers just will not cut it next time if pricing does not decline.
Time for pressure on the federal government
While the provincial government came through with a rebate program this year, the federal government got off scott-free in aid to consumers of heating products. Why? It is now time for both governments to get together and remove all the taxation components on all forms of heat in this country. Both levels of government are making astronomical amounts of revenue on oil royalties and that should be returned to the Canadian consumer. The pressures put on all related heating commodities is complicated that much more by a tax on a necessity in this country and so far, that pricing outlook may be a bleak one for heating, stove oils and natural gas users next winter. The simple removal of all forms of taxation on all forms of heat would go a long way to providing some relief to consumers.
Early summer gasoline outlook
Market investors and refiners have turned their attention to gasoline as the heating oil season comes to an end. Continued investment in commodities ahead of a dropping U.S dollar, may be enough to keep the pressure up on pricing but our models are still showing a “market reluctance” to drive up pricing to consumers. Recession fears are absorbing some of the upwards pressures right now and, I don’t believe that consumers are getting hit with as big of increases as they could possibly be because of that. Bad economic news has resulted in a fear in the markets that energy could be hit sooner than other commodities like foodstuffs. Bearing that thought in mind, it appears that while we may experience some increases heading into the summer, they will not be as great as the $1.50 a litre predicted by some industry analysts out there. Our model still shows a minimum to maximum possible price of $1.22 to $1.37 at the summer peak in July and, even those numbers show the volatility of the markets. Just the difference between last year and this years spot petroleum numbers shows a $1.30 a litre at the pumps is “attainable” at this point.
-30-
For more information, contact;
George Murphy
Group researcher/Member
Consumer Group for Fair Gas Prices
gasprices@hotmail.com
Heavy commodity investment still forcing prices upwards
News release
Conception Bay South, NL, April 08, 2008- Market conditions are still putting upwards pressure on petroleum commodities and that means ‘prices up’ for gasoline along with stove oils this week, that’s according to George Murphy of the Consumer Group for Fair Gas Prices.
“Continued heavy investment into commodities like heating, stove oils and gasoline is putting upwards pressure on those petroleum products as a hedge against the U.S dollar. We’re also dealing with a huge drop in refiner capacity as refiners turn their attentions towards gasoline as we get out of the winter heating season. All this means that consumers here in the province of Newfoundland and Labrador will likely see increases to all petroleum pricing again this week.
What consumers can expect
“All numbers are based on twelve days data out of a possible fourteen that is used to set pricing. It appears that gasoline will see the bigger increase. Numbers there show a possible 2.8 cent a litre hike at the pumps while stove oils will only see a 3/10ths of a cent hike in price. The stove oil number may be a sign that we’re near the peak in pricing for heating oils as well as investors and refiners turn their attention to gasoline for the run-up to the summer driving season. The actual that may occur with heating and stove oils could be higher with the other days of data unavailable yet, although I don’t think those numbers will be significant to radically change things at this point.
Warning for next winter
While pricing for heating and stove oils are both expected to back off from records in short order, those same numbers have to begin to show a substantive drop between now and the fall if we are to avoid any problems with consumers keeping themselves warm next winter. Right now, heating and stove oil pricing is a record 28 cents a litre higher than last year while gasoline is roughly 7 cents a litre higher for the same timeframe. I would advise government now rather than later, to get rebate and retrofit programs ready to catch those who will need it, and that could be everybody next year if pricing does not fall back to more affordable levels between now and the fall. A rebate of $300 to consumers just will not cut it next time if pricing does not decline.
Time for pressure on the federal government
While the provincial government came through with a rebate program this year, the federal government got off scott-free in aid to consumers of heating products. Why? It is now time for both governments to get together and remove all the taxation components on all forms of heat in this country. Both levels of government are making astronomical amounts of revenue on oil royalties and that should be returned to the Canadian consumer. The pressures put on all related heating commodities is complicated that much more by a tax on a necessity in this country and so far, that pricing outlook may be a bleak one for heating, stove oils and natural gas users next winter. The simple removal of all forms of taxation on all forms of heat would go a long way to providing some relief to consumers.
Early summer gasoline outlook
Market investors and refiners have turned their attention to gasoline as the heating oil season comes to an end. Continued investment in commodities ahead of a dropping U.S dollar, may be enough to keep the pressure up on pricing but our models are still showing a “market reluctance” to drive up pricing to consumers. Recession fears are absorbing some of the upwards pressures right now and, I don’t believe that consumers are getting hit with as big of increases as they could possibly be because of that. Bad economic news has resulted in a fear in the markets that energy could be hit sooner than other commodities like foodstuffs. Bearing that thought in mind, it appears that while we may experience some increases heading into the summer, they will not be as great as the $1.50 a litre predicted by some industry analysts out there. Our model still shows a minimum to maximum possible price of $1.22 to $1.37 at the summer peak in July and, even those numbers show the volatility of the markets. Just the difference between last year and this years spot petroleum numbers shows a $1.30 a litre at the pumps is “attainable” at this point.
-30-
For more information, contact;
George Murphy
Group researcher/Member
Consumer Group for Fair Gas Prices
gasprices@hotmail.com
Wednesday, March 26, 2008
Expect no big price changes this week
Contentious gasoline season starts
Media release
Conception Bay South, NL, March 25, 2008 – “Don’t expect to see any large changes to petroleum pricing this week in spite of the drop in crude oil pricing”, that’s from George Murphy of the Consumer Group for Fair Gas Prices.
“Five out of seven days show a slight decrease of 2/10ths of a cent for heating and stove oils, while gasoline shows only a 2/10ths of a cent increase in pricing over twelve days. Remember that heating-stove oils faced interruption last week and that’s why those numbers are for five days of data.
“While oil traded lower on some disturbing economic news, oil’s related commodities still traded at near record levels. Pricing for heating, stove oils and gasoline all remained high with only slight fluctuations through the last week. Refiner capacity dropped back to a low of below 84% which is a sign that refiners have turned attention to shutdowns for maintenance and the switch to gasoline. Capacity has been measured as being very low in spite of the consumer need for refined product this last winter and it’s almost as if there was a ‘purpose’ to keeping refining ability low.
“It appears that heating-stove oils are starting to lose their focus in the markets as numbers started dropping on the New York Mercantile Exchange this week but, unfortunately, I don’t think it has been enough to start to warrant a significant drop in distillates. More substantive drops in heating-stove oils should be realized over the next couple of weeks. If I were a heating-stove oil user, I would rein back on my purchases and just purchase what is absolutely necessary to get by. What is more important in this equation is that we now have to see a substantive drop back in heating-stove oil numbers over the next few months in order to avoid problems like we continue to see today; traders taking advantage of the fact that they were trading on a necessity and not on gasoline which can be less so.
“Next year, government should develop home retrofit programs as well as offer assistance to consumers who may need the help in switching to different heating sources. Conversion to electricity may be more practical and affordable for some in the long term if heating-stove oils continue to be over-priced to consumers.
“Numbers for gasoline are starting to gain more focus in the markets as of the start of this week and it is a sure sign that traders and investors are losing interest in heating-stove oils as a place to make a buck. They’ve hit a brick wall called ‘spring’. All eyes will be on gasoline as numbers for that fuel are already trading very high for this time of year. If people are a little more conservative in their purchases, they may just be able to help keep a handle on pricing of gasoline for the summer in spite of traders actions. Otherwise, we may see a scenario like we just left with heating oil in the dying weeks of winter. A boost in refiner capacity along with a building of gasoline inventories ahead of the summer driving season may be the consumers only hope.”
-30-
For more information, contact;
George Murphy
Group researcher/Member
Consumer Group for Fair Gas Prices
Contentious gasoline season starts
Media release
Conception Bay South, NL, March 25, 2008 – “Don’t expect to see any large changes to petroleum pricing this week in spite of the drop in crude oil pricing”, that’s from George Murphy of the Consumer Group for Fair Gas Prices.
“Five out of seven days show a slight decrease of 2/10ths of a cent for heating and stove oils, while gasoline shows only a 2/10ths of a cent increase in pricing over twelve days. Remember that heating-stove oils faced interruption last week and that’s why those numbers are for five days of data.
“While oil traded lower on some disturbing economic news, oil’s related commodities still traded at near record levels. Pricing for heating, stove oils and gasoline all remained high with only slight fluctuations through the last week. Refiner capacity dropped back to a low of below 84% which is a sign that refiners have turned attention to shutdowns for maintenance and the switch to gasoline. Capacity has been measured as being very low in spite of the consumer need for refined product this last winter and it’s almost as if there was a ‘purpose’ to keeping refining ability low.
“It appears that heating-stove oils are starting to lose their focus in the markets as numbers started dropping on the New York Mercantile Exchange this week but, unfortunately, I don’t think it has been enough to start to warrant a significant drop in distillates. More substantive drops in heating-stove oils should be realized over the next couple of weeks. If I were a heating-stove oil user, I would rein back on my purchases and just purchase what is absolutely necessary to get by. What is more important in this equation is that we now have to see a substantive drop back in heating-stove oil numbers over the next few months in order to avoid problems like we continue to see today; traders taking advantage of the fact that they were trading on a necessity and not on gasoline which can be less so.
“Next year, government should develop home retrofit programs as well as offer assistance to consumers who may need the help in switching to different heating sources. Conversion to electricity may be more practical and affordable for some in the long term if heating-stove oils continue to be over-priced to consumers.
“Numbers for gasoline are starting to gain more focus in the markets as of the start of this week and it is a sure sign that traders and investors are losing interest in heating-stove oils as a place to make a buck. They’ve hit a brick wall called ‘spring’. All eyes will be on gasoline as numbers for that fuel are already trading very high for this time of year. If people are a little more conservative in their purchases, they may just be able to help keep a handle on pricing of gasoline for the summer in spite of traders actions. Otherwise, we may see a scenario like we just left with heating oil in the dying weeks of winter. A boost in refiner capacity along with a building of gasoline inventories ahead of the summer driving season may be the consumers only hope.”
-30-
For more information, contact;
George Murphy
Group researcher/Member
Consumer Group for Fair Gas Prices
Tuesday, March 18, 2008
Heating-stove oils face upwards price interruption
No changes coming to gasoline
Media release
Conception Bay South, NL, March 18, 2008- Consumers of heating-stove oils and possibly diesel fuels will see an upwards spike in prices tomorrow night as numbers for those petroleum products have increased radically this past week. That means that the Petroleum Pricing Office will use its interrupter formula to increase those prices.
“Numbers we have for the first five days of this pricing session are indicative of where we’ll see heating-stove oils head this week. Numbers are showing an allowable of 7.1 cents a litre upwards over those first five days and numbers from the New York Mercantile Exchange continue to trade above the four cent allowable for interruption to occur for Monday and Tuesday. While those two days traded down, we’re still in interrupter territory. The actual increase at the end of the day will be greater than five cents a litre,” said George Murphy.
“Gasoline remains unaffected as those numbers have not seen the huge spikes in pricing on the markets like the distillate group of fuels that includes heating, stove, and jet fuels. That’s probably part reason why we saw some of the major airlines increase fuel surcharges the last few days, Air Canada being another to do it just this week.
“The markets remain volatile with investors forcing upwards the prices for related commodities even though we’re at the end of the heating season. We have record spot pricing for heating oil that ranges in the $3.20 a US gallon mark, a price not seen in the history of trading.
“It is simply unknown why investors and traders continue to invest heavily in a ‘winter’ product. We all know that people can no longer afford to pay in excess of a buck a litre for heating oil product but they soon will be paying that in the immediate St. John’s and Mt. Pearl areas. Two weeks ago, I wouldn’t have believed it to be possible. Traders and investors on the MYMEX are showing how irresponsible they are when they invest out of simple ‘desperation”. They have nothing else they can find to make money on in the face of a falling US dollar? The last thing I’d be investing in at this time where there is heavy talk of a recession is any kind of energy based on crude oil.
“Either way you look at it, Big Oil is not going to move any more product with prices moving up. What they have done is drive up the price to a level where heating oils as well as stove oils, are no longer affordable and they have successfully provided their own means of building inventory. People can no longer afford and therefore, cannot buy in the same quantity.”
-30-
For more information, contact;
George Murphy
Group researcher/Member
Consumer Group for Fair Gas Prices
gasprices@hotmail.com
No changes coming to gasoline
Media release
Conception Bay South, NL, March 18, 2008- Consumers of heating-stove oils and possibly diesel fuels will see an upwards spike in prices tomorrow night as numbers for those petroleum products have increased radically this past week. That means that the Petroleum Pricing Office will use its interrupter formula to increase those prices.
“Numbers we have for the first five days of this pricing session are indicative of where we’ll see heating-stove oils head this week. Numbers are showing an allowable of 7.1 cents a litre upwards over those first five days and numbers from the New York Mercantile Exchange continue to trade above the four cent allowable for interruption to occur for Monday and Tuesday. While those two days traded down, we’re still in interrupter territory. The actual increase at the end of the day will be greater than five cents a litre,” said George Murphy.
“Gasoline remains unaffected as those numbers have not seen the huge spikes in pricing on the markets like the distillate group of fuels that includes heating, stove, and jet fuels. That’s probably part reason why we saw some of the major airlines increase fuel surcharges the last few days, Air Canada being another to do it just this week.
“The markets remain volatile with investors forcing upwards the prices for related commodities even though we’re at the end of the heating season. We have record spot pricing for heating oil that ranges in the $3.20 a US gallon mark, a price not seen in the history of trading.
“It is simply unknown why investors and traders continue to invest heavily in a ‘winter’ product. We all know that people can no longer afford to pay in excess of a buck a litre for heating oil product but they soon will be paying that in the immediate St. John’s and Mt. Pearl areas. Two weeks ago, I wouldn’t have believed it to be possible. Traders and investors on the MYMEX are showing how irresponsible they are when they invest out of simple ‘desperation”. They have nothing else they can find to make money on in the face of a falling US dollar? The last thing I’d be investing in at this time where there is heavy talk of a recession is any kind of energy based on crude oil.
“Either way you look at it, Big Oil is not going to move any more product with prices moving up. What they have done is drive up the price to a level where heating oils as well as stove oils, are no longer affordable and they have successfully provided their own means of building inventory. People can no longer afford and therefore, cannot buy in the same quantity.”
-30-
For more information, contact;
George Murphy
Group researcher/Member
Consumer Group for Fair Gas Prices
gasprices@hotmail.com
Wednesday, March 12, 2008
New data still shows increases to heating and stove oils
Gasoline to drop...
I have some new data to share with you all in the province...Follows from yesterdays post.
New numbers here are still showing an increase coming to heating oil prices as well as those for stove oils, this time for twelve days show an allowable of 1.86 cents per litre. That could mean a possible high selling price of 98.02 cents per litre for heating-stove oils in this area!
Unbelievable!...
Initial projections at the start of the fall season showed numbers anywhere between 85 and 95 cents with a buck a litre possible...
Gasoline shows downwards at 1.9 cents in spite of the record trading price for crude oil. I think that what this shows is that this commodity has been stretched to its limit when it comes to being a toll worthy of investment rather than the US greenback. I think that what we see is the law of diminishing returns kicking in here-you can raise the price but you will still sell less product to make the same revenues...
As a sidenote?...
Nice to see M.J Ervin revise the summer forecast for gasoline pricing but his numbers are still a little too high. He's forecasting summertime prices of $1.20 a litre in the metro areas-I presume he's talking Toronto- with possible spikes of $1.50 in more rural areas.
I feel like we're all caught in a "bid-ask" scenario at times with the Calgary company part of the "ask" side...lol
My models are still showing anywhere between $1.22 and $1.37 a litre for gas in the immediate St.John's area and with my most recent model showing $1.28 a litre at peak.That means that Toronto and it's environs could see anywhere around what they are experiencing right now, around the $1.08 figure...
Keep in mind that this does not include panic scenarios to the markets like-you heard from me first-"Hurricane Syndrome". Otherwise, that could mean spikes to newfound territory in pricing again.
I'm still taking bets that investors are soon going to realise that they can't drive up the price of commodities anymore than what they fel the consumer is willing to pay and that's why, when you mix recesion into the equation, that we'll soon see a "profit-taking selloff" in crude oil.
Hold off on buying any more heating oils for now, if you can do it. My bets are that this is the last of the increases and we'll soon be witness to a slide in heating-stove oil spot pricing.
Any comments, drop me a note or leave one here...
Regards,
George Murphy
Consumer Group for Fair Gas Prices
What's wrong with oil?
I was asked the other day what it is about oil that has attracted so many to invest in it rather than sink money into other things that one would consider "recession-proof".
Present investment in oil is a little disheartening to see to the average consumer but to play folly with my investment plan and put that money to risk on oil instead of other solid things, is a little suicidal in my belief. That's part of the problem that I have with the latest run-up in crude oil pricing for which the US dollar has taken the back seat...
I don't understand how simple rules of economics can be ignored and money invested in a product that will see some sort of decline in usage if the recession talk comes to fruition. If we are indeed, heading towards recession, jobs and energy usage are the first to feel the blow of any slowdown in economic activity. Then why is there such heavy investment in oil?
I've heard every excuse in the book as to the reasons why you and me are going to pay at the pumps for investors folly but, is that any reason to become a spark that will aid in causing a recession at the same time? When will the spark come that will "start" the slowdown on demand and cause pricing to slip again? If there is recession then high prices for crude oil and their related commodities will surely be the reason for it. That, and George Bush's entry into Iraq... 17 billion in the war now, and counting.Is there any other reason for it?
By the way...
I still have only eight days data out of a possible fourteen that still shows a slight drop in gasoline pricing (2.3 a litre) and a slight increase in heating-stove oil numbers (1.5 a litre). Both modest numbers on already high prices should also be a warning for the oil investor out there: you're already starting to deal with the laws of diminishing returns.
I'm betting my money on the inevitable decline in crude in the next few months if the trend of recession continues. I would suggest to you people who have unknowingly invested in oil through your pension palns to get in touch and ask questions about your investors "investment"...It is, after all, your money...
Sunday, March 02, 2008
Possible downwards interruption in pricing?
Yup...
You read it right...
Seems that the first two days of this pricing session are pointing down and that means that, if it keeps up for the next couple of days, there is a liklihood that we'll see a drop downwards in gasoline and heating oil pricing...
Numbers on gasoline for the first two days show almost 4.7 cents a litre down waith taxes in while heating and stove oils are perilously close to the four cents needed to see them drop as early as this coming Thursday.
Stay tuned as I'll have more this coming Tuesday.In the meantime, try to buy as little as is needed.
George Murphy
gasprices@hotmail.com
Yup...
You read it right...
Seems that the first two days of this pricing session are pointing down and that means that, if it keeps up for the next couple of days, there is a liklihood that we'll see a drop downwards in gasoline and heating oil pricing...
Numbers on gasoline for the first two days show almost 4.7 cents a litre down waith taxes in while heating and stove oils are perilously close to the four cents needed to see them drop as early as this coming Thursday.
Stay tuned as I'll have more this coming Tuesday.In the meantime, try to buy as little as is needed.
George Murphy
gasprices@hotmail.com
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