Good morning,
I hope that this message finds everyone well. Crude oil markets went on a wild ride this week. After a steep sell off from Trump announcing his positive COVID-19 test and hospitalization, markets rebounded when Trump returned home. In addition, politics started to play out where stimulus packages would get passed in Congress. And then hurricane Delta poked its nose into the mix shutting down oil production and exports in the Gulf. To top off the rally back, US inventories experienced a draw due to production cuts. By Wednesday, crude prices were back to the highs of last week. And now with the hurricane hitting land soon, traders took WTI over the $40/barrel mark and will probably hold until next week sometime. Crude prices are very volatile. I was expecting crude prices to drop today based on increased numbers of jobless claims and 23.5M people out of work with unemployment benefits running out. Something needs to happen to support the economy. Our entire airlines industry is going to collapse and 23.5M people out of work going into winter and holiday season is not particularity great for oil demand. If Congress gets a deal done I believe that crude prices can hold. If there is no deal on stimulus, then I could see crude prices tanking into the end of year.
In local news, retail prices have finally started to catch up to the increased cost on gas and diesel out of the Chicago spot market. Although spot prices have eased a bit, I expect to see gasoline and diesel prices over $2/gallon for the coming week.
Propane production and supplies are ample, but prices continue to climb. The situation is much of a head scratcher. We are already at contract prices for our spot market pricing. I think propane prices are setup to ease if the winter is mild. You can still lock in your prices for winter though. If you are unsure if your account is keep-fill or will-call, please call the office to clarify. Hard to believe that winter is already sneaking up!
As always, if you have any questions, comments, or concerns, please feel free to give us a call.
Best regards,
Jon Crawford