President Trump’s plan to keep crude prices low for midterm elections worked perfectly. He convinced Saudi Arabia and Russia to pump more oil to make up for the sanctions being put on Iran which started on November 1st. Leading up to November 1st, crude prices started to relax as world demand and possible surplus crude supplies from the US were in question. Then to put the icing on the cake to insure that prices stayed low, President Trump on November 1st granted eight waivers to countries allowing them to buy Iranian crude. This action sent prices falling even further. Now Saudi Arabia, Russia, and the rest of OPEC are very upset. OPEC countries are mad at Saudi Arabia and Russia for trying to help the U.S. with the Iran sanctions which put prices at risk. And Saudi Arabi is furious at the U.S. for granting the waivers putting crude supplies into possible greater surplus. Regardless, lower prices will be here for a little while until the OPEC meeting during the first part of December. I expect OPEC to announce supply cuts. The U.S. made too many moves to help the elections and I fear retaliation. So for now, enjoy the cheaper prices. But I wouldn’t hold out that these current prices stay through Christmas.
Local retail prices on gasoline continue to inch down closer to $2.49/gallon. With the latest price drops, I wouldn’t be surprised if we see $2.49/gallon on gasoline this weekend or early next week. Diesel prices continue to remain higher now that winter additives are in the price as well increased demand for harvest. I don’t expect to see too much movement on diesel prices.
Propane prices continue to remain calm. As I have been saying for months, once we have a demand event or crude turns around, hold on. Propane is still setup for a nice price jump at some point this season. If you are a will-call customer, I highly recommend that you fill your tank now. In addition, if you monitor your own tank levels, please make sure to call us when you are around 30% to give us sufficient time to complete your delivery during the winter months.
As always, if you have any questions, comments, or concerns, please feel free to give us a call.