WTI Crude oil continued to trade in a narrow range between $70-75/barrel. As the OPEC+ meeting approaches, the debate between Saudi Arabia and Russia is starting to heat up. Saudi wants to keep production increases small to support prices, and Russia wants all limits lifted to put pressure on US producers and go after market share. In more geopolitical news, Iran elected a new hardline-president that looks to further isolate Iran from a nuclear deal with the US. The potential for a negotiation stand-off is back on the table which would keep Iranian crude exports from increasing with greater transparency. At home, inflation continues to rise and crude inventories continue to fall giving support to prices. Even though US production is strong, exports and domestic demand are strong. So for now, we wait and see what happens with OPEC+ meetings.
In local markets, retails prices continue to rise with the cost of product. Gasoline retail is inching ever closer to $3/gal and diesel retail has been holding fairly steady around $3/gal. Unfortunately, until we experience any major drop in crude prices, these retail prices will be here for a bit.
Propane cost continues to go higher and higher. The US is now officially at the lowest level of summer propane inventory in over eight years! There is quite a possibility that the retail prices back in April will be the lowest for the year. I highly recommend everyone locking in some of their heating season gallons. Although Canada is flush with propane, rail shipments will be very volatile as backorders of goods and cars start to return to the market possibly end of year. Unless crude oil prices fall over $15/barrel, I can see propane prices being in for a wild ride this year.
As always, if you have any questions, comments, or concerns, please feel free to give us a call.