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.