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Tuesday, December 16, 2014

Numbers for Thursday, December 18, 2014

Well, the numbers are in for Thursday.

Here's what I have, along with a few more to note. Don't forget winter blending that may throw off diesel and heating oil numbers, and don't forget HUGE volatility may be in the numbers from heavy market activity!:

Heating and stove oils are showing a drop of 1.75 cents a litre
Diesel shows a drop of 1.2 cents a litre.
Gasoline shows a drop of six cents a litre.

This time next week should see a gas price in the high eighties in the St. John's northeast region. Enjoy!...But conserve!

Jet fuel now shows an even sixty cents a litre. On June 27th that number was 86 cents a litre. To all of you, it is really time to get upset over the fact that the airlines are still maxing out on air fuel surcharges to airline customers. It's really time they give back!

#6 fuel oil for electrical generation is also down to $47.75 a US barrel. It was pricing in at $96 US in June. That means that the rate adjustment formula should bring some drop to electricity prices here in Newfoundland and Labrador. If you don't live here, you should also see some sort of break, if you use that type of generation in the grid!

The Saudi's are having a little more competition from a fellow OPEC member, Iran. With concerns over the loss of market share, the Iranians are competing for Asian customers as they try to retain their own markets. If that keep up, look for other oil-producing nations to "join in" and drop prices to their customers.

Finally, the Canadian dollar continues to take a beating at the loss of the price of oil. We've lost almost a cent and a half against the US greenback over the last week!

That's it for now!

Regards,

George
Twitter @GeorgeMurphyMHA

Tuesday, December 09, 2014

Price changes for Thursday, December 11, 2014

Hi to all,

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

Heating and stove oils show a drop of 3 cents a litre.
Diesel shows a drop of 4.1 cents a litre, and...
Gasoline shows a drop of 5.6 cents a litre.


Keep in mind that these numbers are off the regulated maximum. St. John's East could be looking at under a buck a litre by Monday/Tuesday of this drop comes into effect.

I was off last week on the gas numbers, the most in months, however, I believe I wasn't really that far off as Halifax prices dropped steeply last week by better than six cents a litre. They're measured just a day apart from us here. I think the gasoline number should be a little closer this time around, but don't forget that there's still a very volatile market out there, and of course, we're still dealing with the winter heating and Diesel blends!

Oil starting to flatten?
The Asian countries are the beneficiaries of some pretty good deals on oil as Saudi Arabia is still competing with US producers. Seems as though the challenge is on and we're starting to see some US companies starting to park their plans to frack for more oil in 2015. We may be witnessing a flattening of oil output from the US, and hence, a slowdown in drops to prices, and perhaps some stability to oil and refined product.
We'll see what happens in the markets, but the last measure I had of oil producing rigs and drilling projects still didn't make it apparent that drilling was stopping. Question is, are the Saudi's ready to keep prices steady?

I'll keep an eye out.

Airline fuel surcharges should come down
In the meantime, airline customers should be asking their respective carriers why they haven't returned some savings back to customers. Jet fuel prices have also retreated sharply, with jet fuel at 86 cents a litre Canadian in June to today's 64 cents a litre. It would be a nice travel season discount to regular flyers who have been paying a fortune in airline fuel surcharges as of late. That's close to 25 percent less than what it was in June month.

That's it for now!

Regards and safe travels!

George
Twitter @GeorgeMurphyMHA

Tuesday, December 02, 2014

Thursday, December 4th, 2014 Price changes

Hi to everyone,

Sorry I didn't get these numbers posted sooner, but work has to take precedent. Nevertheless, keep in mind that there's lots of volatility in the markets, so they're going to be off somewhat. And don't forget winter blending on the heating and diesel numbers!

Here's what I have:

Heating and stove oils to drop by 4.23 cents a litre.
Diesel shows a drop of 4.6 cents a litre, and...
Gasoline shows a drop of 4.2 cents a litre.

The Canadian dollar remained relatively steady against the US dollar. In the markets, while China began buying some oil off the markets to help lift oil prices yesterday, they didn't sustain in the eyes of the speculators. With ever-growing US domestic production, OPEC faces the bold new world reality that they're facing something that they've never had to face before, that of competition.

Maybe now some parts of this world might be able to compete and grow their economies with cheaper energy. The fact remains however, that we can't forget high prices as they were. Have we learned the lessons of the folly of remaining oil dependent to supply ourselves with the means to drive our economies or our homes? Will the world turn its backs to retrofitting and other energy alternatives as viable options in a world that is oil-hungry?

Don't let our governments forget the hard lessons that so many had paid for as energy prices come down more.

We can't be held "over a barrel" again!

Regards,

George
Twitter @GeorgeMurphyMHA

Tuesday, November 25, 2014

Numbers for Thursday, November 27, 2014

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

Heating and stove oils show a drop of 1.27 cents a litre.
Diesel shows down by 1.5 cents, and...
Gasoline shows a drop of just 6/10ths of a cent a litre.

Keep in mind that there's a lot of volatility out there and that the winter blend is in for heating and Diesel numbers. They may be off somewhat.

The Canadian dollar actually gained about a half penny against the US dollar the last week. And with spot prices for all fuels measured showing hardly any change, that was the difference.

However, today, while the dollar gained slightly, we also saw the start of another move downwards for oil. It could be the start of what some are predicting as a move down to $60 US a barrel for West Texas Intermediate.

In the meantime, OPEC meets on Thursday. My feeling is that they have no choice but to put a symbolic cut to production in place. If they drop production, they risk losing important customers for their oil amid growing American US domestic production now pegged at 9.1 million barrels a day.

Watch the business news on Thursday for what OPEC does. I'm still sticking to a cut of 500,000 barrels a day by OPEC.

That's it for this week!

Regards,

George Murphy
Twitter @GeorgeMurphyMHA

Tuesday, November 18, 2014

Numbers for Thursday, November 20, 2014

Hi to all,

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

Heating and stove oils projected to drop by 2.96 cents a litre.
Diesel shows a drop of 1.9 cents a litre on the way, and...
Gasoline shows a drop of 2.4 cents a litre.


For the previous two weeks, I have been out a little, especially last week with my numbers down while an increase came into effect. I'll blame it on volatility out there. While it was down two weeks ago, it was down much further than expected, and I'm thinking the difference added up to an increase for last week instead
.
But it looks like things will be back on track for this week again.

US domestic production of crude oil continues to set records, with the numbers amounting to nearly 9.1 million barrels a day being pumped out of the ground in the US. That's offsetting any possible cut that OPEC may be thinking. We'll find out later on the 27th if OPEC will institute any cuts, but with US domestic rising, it's not likely they will at the risk of losing market share.

At least that's the talk out of the Middle East.

I'm thinking that OPEC will make a move, but not a substantial one. I think right now they'd all be happy just to stop the fall of oil and offset any US domestic production that may come on line to add to the world glut.

George is guessing OPEC will cut by 500,000 barrels a day to try to stop the slide.

Any takers?...

We'll see what happens!

That's it for this week!

Regards,

George
Twitter @GeorgeMurphyMHA

Tuesday, November 11, 2014

Numbers for Thursday, November 13, 2014



Hi to all,

Hope everyone had a great Remembrance Day and that you all got out to our respective communities to help remember the sacrifice others made for us...

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

Heating and stove oils to drop by just 1/10th of a cent.
Diesel prices to increase by 4/10ths of a cent a litre, and...
Gasoline to drop by 7/10ths of a cent a litre.

Keep in mind that my heating and Diesel numbers may be off somewhat as a result of winter fuel blending!

OPEC meets November 27th in Vienna
Surely we'd all like to be a bug on the wall at the next meeting of OPEC on November 27th when they discuss the possibilities of making production cuts to try and support the price of oil.

I know I would!

OPEC members Saudi Arabia and Iraq aren't all that fussy about making production cuts it seems, and it's doubtful if OPEC as a group would institute such a measure that would bring trouble for some of the member nations. Just think about Venezuela having to take a share of the cut with that country already facing a heavy debt and running close to a 60% inflation rate! With US domestic producers pounding out product and looking to export, it may be a new reality for OPEC that they'd be looking at market competition. According to what I'm hearing, they may take the new price of oil as the new normal for the oil markets as a result. Funny as it seems, but OPEC might not be able to compete for a long time to come.

Lower oil good for North Atlantic Refining
Here? It has to be good for our local refiner North Atlantic! One of the largest problems they had to deal with was the rising price of crude. Now that oil is a little cheaper for them, it helps the survivability of the refinery. Gas is cheaper than what it was a short time ago and crude acquisition costs are down as well.

That means jobs on an improved bottom line.

By the way. Brent closed at $80.35 US today.

That's it for now!

Regards,

George Murphy
Twitter @GeorgeMurphyMHA

Tuesday, November 04, 2014

Price changes for Thursday, November 6th, 2014

Hi to everyone,

Here's what I have for price changes this week. Keep in mind that my heating oil and Diesel numbers may be off somewhat as a result of winter blending!

In the meantime, not too much in changes this week, namely be cause of the poor performance of the Canadian dollar against the US greenback. Our "beloved" loonie lost a good 2.6 cents against the US buck in the last six days and that's accounting for a lot.

Heating and stove oils show an increase of 55/100ths of a cent a litre.
Diesel shows an added 1.3 cents a litre, and...
Gasoline shows a drop of just 9/10ths of a cent a litre.

An important note here with the numbers.
While there's not much of a drop to be shown with distillate prices, it's important to remember that we are in the winter demand season. In spite of lower oil, there has been limited impacts on both heating oil and diesel prices. Draws on US inventory aren't helping the matter.

Gasoline a little different as demand remains flat, even with lower prices. refiner capacity is a full seven percent below the normal due to refiners switching from gasoline refinement to distillates. When production resumes, this should add to inventories and bring prices down further.

In the meantime, I'm looking with interest at tomorrow's inventory report from the EIA, sometime around noon release on that.

Lastly, on gasoline.

Spot prices reflect the start of what may come next week. While they averaged about 67 cents this last session, today ended off about 65 cents. If that keeps going like it is, look for about another two cents "guess-timate" for next week to come.

I think the Saudi's are beginning to go for broke with the discounts on oil they're offering their US customers. The advent of huge growth in US domestic production is finally putting the pressure on OPEC pricing and the Saudi's are forced to discount to maintain their market share. Mind you, we're seeing the benefits of that and also witnessing some dissent amongst other OPEC producers who think that Saudi Arabia alone should be forced to take the majority of any production cut, should OPEC implement a cut on November 27th.

I won't overload you all with what I'm thinking is going to happen over the next few weeks. If you have any questions, drop me a note.

That's it for this week!

George
Twitter @GeorgeMurphyMHA