Monthly Archives: August 2018

Flooding, Tornados, and Safety Announcement

Posted on by

Good morning everyone,

I would like to first of all say that our thoughts and prayers are with our customers and friends affected by the recent tornados and flooding.  We are so sorry to see the damage and lives affected by these storms.  If you need any support or help, please call us.  We are happy to help and assist in any way that we can.

I would also like to say that if you have fuel tanks or propane tanks on your property that you believe might be damaged or were compromised due to the storms and flooding, please contact us and we would be happy to inspect.  If you feel the situation might be unsafe, please call.  We would rather you be safe during this stressful time.

As always, if you have any questions, comments, or concerns, please feel free to give us a call.

We wish everyone continued safety as the clean up continues.  And please, do not hesitate to ask us for help.

Best regards,

Jon Crawford – Pres.

The Great Unknown

Posted on by

Good morning,

Crude oil prices have continued a downward trajectory of over $10/barrel since June.  Prices are starting to stabilize around the $66-69/barrel for WTI.  There are so many bullish and bearish issues affecting prices right now.  Iran sanctions coming online in November, countries not following sanctions, Iran threatening to block passage of crude ships, Saudi Arabia cutting production instead of increasing, US increasing production to record levels, major oil producer in Canada back online shipping over 1.5M barrels/day back to the US, US/China trade war, US/Turkey economic conflict, OPEC arguing over upcoming quotas, demand is starting to fall, ships of crude are starting to pop up in places without a home, IEA changed their outlook again on demand, and futures traders liquidated over 30% of their bullish positions for 2019…… WHEW!…. that’s a lot!…  So what’s going to happen?  Right now it’s a day-by-day trade.  Feels like the pot is boiling and it could boil over or someone could turn down the heat.  I’m just not confident on taking a hedge position at this time.

In local news, retail prices for gasoline and diesel have started to ease.  However, there was an announcement of a major turnaround this fall at the Bp Whiting refinery.  This could cause some major price spikes during harvest season.  More info to come.

Propane prices have continued to move up as we go into fall.  Inventory levels are below the five year average and many are calling for a colder than average winter.  I highly recommend that everyone fill their tanks now and contract propane for the 2018-2019 season.

As always, if you have any questions, comments, or concerns, please feel free to give us a call.

Best regards,

Jon Crawford – Pres.

Whipsaw on Crude Prices This Week

Posted on by

Good morning,

I hope this message finds everyone well.  This week has been very interesting for the crude markets.  We experienced a good price jump higher on Tuesday based on news of the strict sanctions Trump is looking to enforce on Iranian crude exports.  In addition, the API Inventory report showed a large crude draw and flat levels for gasoline and distillate.  But then on Wednesday, China announced tariffs on US Crude Oil imports and the EIA reported a much smaller draw in crude supplies coupled with a massive build in gasoline and distillate inventories.  The China news and EIA report, along with the announcement that other countries were not going to play along with Iranian sanctions, caused a 3.2% drop in crude prices, pushing WTI through the support price of $67/barrel.  So for now, we are looking at the $67-70/barrel range for WTI prices.  Crude prices are basically controlled by headlines at the moment, so it’s a very volatile and unpredictable trade at the moment.

Retail prices on gasoline and diesel have eased a bit since last week.  I expect prices to hold throughout the weekend.  Right now summer demand for gasoline in Wisconsin is down compared to last year.  I believe that the intense amount of road construction along with higher prices have dampened travel plans this summer.

Propane prices have started to rise.  Inventory levels across the country are sitting around the same level as last year.  Analysts are worried that intense cold will put pressure on supply.  Unless we make up some ground in inventory levels across the country, the potential for a price break out on propane this winter is very high.  But I want everyone to know that Wisconsin is in great shape for supply crunches.  There have been five new rail terminals along three different railways added in the last two years, including upgrades to current facilities and retail storage capacities.  If you have not filled your tank this summer, please do so.  And if you have not locked in your prices for the winter, I highly recommend that you contract your gallons by the end of August to ensure a good price.

As always, if you have any questions, comments, or concerns, please feel free to give us a call.

Best regards,

Jon Crawford – Pres.

Thank You To Our Customers!

Posted on by

Good afternoon,

I just wanted to take a quick moment and thank everyone who came out to our Customer Appreciation Day on July 27th.  We served over 500 people and had the best weather you could ask for!  I am so happy to celebrate our customers each and every year.  I also wanted to say congrats to Sydney Simonson on winning a pair of Packers tickets in our raffle.  We hope you enjoy the game and you help the Pack bring in a win! 🙂

In market news, crude oil prices dropped almost 10% in July and are starting out down in August.  We are expecting to see retail prices remain around the same since local cost of fuel increased with the expiration of the August contract on the Chicago Mercantile.  I am keeping my eyes on the trade wars, Iran and Russian communications, as well supply point bottlenecks to see where we might go in August.  I am still long on crude prices going into the fall and next spring.

Propane prices are holding steady.  If you have not ordered a summer fill, please do so.  Once summer economics expire in the propane market, I expect to see prices jump 5-10 cents.  I also highly recommend contracting your propane for the upcoming heating season.  I am very bullish on propane prices for the upcoming season due to low inventories and high export volume.

As always, if you have any questions, comments, or concerns, please feel free to give us a call.

Best regards,

Jon Crawford – Pres.