Greetings!

Well, winter snuck up on us pretty fast to start November!  Single digit temps and lots of snow the past week have made November feel like January!  Corn drying demand and the colder than normal temperatures have put a lot of pressure on propane distribution.  There is not a shortage of propane, but there is only so much propane that can move through distribution at one time.  Hopefully by the end of November harvest will be almost completed and temperatures will be back up to normal.  But for right now, we are calling for colder than normal through the end of November.

Crude prices spiked on the hopes of a China trade deal.  Although crude prices are still very low, we don’t expect to see much more upward movement.  I am not convinced that demand is going to outstrip supply in the coming six months.

Retail prices on gasoline have dipped a bit.  But I would not expect to see prices drop much more.  Diesel prices have risen since winter additive blending and #1 oil have entered the supply picture due to the extreme cold.  Winter additive blending and #1 oil can add up to 20 cents/gallon to the cost of diesel fuel.  I would expect to see diesel prices remain higher now that winter temps are here.

Propane prices have risen due to the massive demand spike in the Midwest.  I do not expect to see prices relax from their current levels anytime soon.  If you are a will-call customer, please make sure to check your tank!  This cold snap has caught many customers off guard.  Also, please make sure to salt or sand your driveway to ensure a safe and efficient delivery, and that there is a clear path to your tank.

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

Best regards,

Jon Crawford

Good afternoon!

I hope everyone had a great Halloween even though it was cold and snowy out.  Sounds like the cold weather is going to stick around for awhile.  If all weather patterns hold, we are in store for a colder winter with a lot of snow.  I will keep you updated based on the prediction services we subscribe to.

Also, I wanted to clarify that there is no propane emergency in Wisconsin.  Gov Evers issued an extension of service hours exemption this week and made reference to a propane emergency.  This is not true.  We are having a high demand cycle with corn drying and the early cold weather, but there is no emergency.  Basically, trucks are waiting extra long hours to load product, so we want to make sure that drivers have enough hours on their books to deliver the product.  Once corn drying is over, distribution will be back to normal.  But there is no emergency, shortage of product for this winter, massive price spikes on the way, or anything to be too concerned about at this time.  I will keep you posted as the month goes along.

Crude prices continue to trade narrow range.  We are still predicting that WTI crude oil will trade around $55/barrel through the end of the year.  Nothing new on this front.

In local retail news, refinery maintenance has been longer than expected and supplies are starting to get a bit tight.  I would expect to see prices at the pump on gasoline and diesel rise next week.

Propane prices are rising due to increased demand, but nothing out of the ordinary.  If you are on a will-call, please remember to check your tank.  The early cold and snow has caught some customers by surprise! 🙂

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

Best regards,

Jon Crawford

Good morning,

Headlines around a softening economy and lower refinery runs continue to weigh on crude prices.  Economic data is starting to spoke investors as they continue to move money out of long positions on crude.  WTI is looking to close below $55/barrel this week.  Many firms are lowering outlook for crude prices into 2020 as well.  History shows that crude prices tend to stay low during election years as well.  As conditions in Syria hold some Middle East tensions, OPEC continues to say they will cut production to keep prices from falling off a cliff.  Considering that the next meeting is not until December, I believe OPEC is scared that crude prices could fall through a trap door and collapse.  For now, I think WTI crude prices will remain under $60/barrel for the remainder of the year and have a long ways to go before stars align to pop the price out of its current trend.

In local news, Chicago refinery markets are out of refinery maintenance mode and flush with product.  Retail prices on gasoline and diesel continue to soften.  I expect to see prices at the pump continue a slow downward trend.

Propane prices have leveled off for now as demand is starting to kick in.  I think you will see propane prices start to move higher next week with continued cold and crop drying demand.

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

Best regards,

Jon Crawford – Pres.

Good morning!

Crude prices pressed “repeat” again this week with supply and economic news driving the volatility.  We started the week off with Brexit drama, Iraq announcing that they pumped more oil than they should have, and Iran saying they will breach all parts of the nuclear deal.  Prices dropped hard.  Then OPEC comes out after a new Saudi Oil Minister was named saying that they will do whatever is necessary to keep prices high leading into the Aramco IPO.  Iraq followed saying they will behave and do better on cuts moving forward.  Even Russia said they would work with the US on crude prices which is unheard of!  The news cause prices to spike higher.  Then on Wednesday, inventory numbers on crude levels displayed large draws coupled with strong economic data in the US causing prices to spike even higher.  But then in the afternoon, Trump fired John Bolton, the biggest Hawk on Iran, and said he would consider waivers on Iranian crude exports to get them to the table for negotiation.  Crude prices turned and fell off a cliff.  Then on Thursday the IEA announced that world supply would probably go into major surplus in 2020, causing prices to continue the fall.  And finally, today economic data on the US was strong and US/China trade relations showed movement to the positive with each country giving in a bit.  The US will not enforce new trade tariffs, and China will lift the agricultural purchasing tariffs and buy soybeans.  The news gave support to crude prices and stopped the fall.  So WTI crude price ended where it started at about $55/barrel.  What a ride the past weeks have been for crude prices and I don’t see it stopping anytime soon.

Retail prices on gasoline continue to stay very low.  Prices on regular gasoline are ranging between $2.34-2.44/gallon based on major price differentials currently between suppliers.  Diesel prices are also remaining very stable going into harvest season.

Propane prices are slowly starting to creep up, but nothing too scary.  Propane is trading based on crude movement.  We are still at historically low prices of propane with historically high volumes of inventory.  We do not expect to see prices rising until October 1st when winter tariffs kick in and harvest demand starts to take shape.  If you have not contracted your volume for the heating season, you can still do so.  Please call our office to have your tank filled and we can prepare a contract for you.

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

Best regards,

Jon Crawford

Good afternoon!

I hope everyone had a wonderful and safe Labor Day weekend.  Crude oil prices went on a roller coaster following the long weekend.  The week started out with tumble as China announced retaliation tariffs along with economic pressures starting to creep into the US markets and Chinese data.  But then a day later, China and the US announced a meeting and everything turned around!  In addition, the Hurricane Dorian managed to miss the Gulf so no oil production will be impacted here in the US.  But then, the big rally was dampened by the release of info that OPEC, particularly Russia, is not holding to compliance cuts.  As prices started to relax, Yemen announced that they killed 30 Saudi’s in retaliation strikes today which caused crude to soar higher, coupled with large announced draws in US inventory.  In addition, the US payroll data was fantastic and China revised their production data showing no contraction.  But by the end of the day, crude oil prices finished flat with world economics and potential over supply still in play.  What a roller coaster and a head scratcher!  Crude has been trading with high volatility in a narrow $5/barrel range.  This tells me that crude is ripe for a break out in one direction.  Which direction is TBD!  And by TBD, that means what news stores are discussed for the day! 🙂

In local retail news, gasoline prices have fallen below $2.49/gallon and were are five year lows for Labor Day.  The lower prices were a nice relief on everyone who was traveling.  Diesel prices continue to fall as Chicago economics continue to favor our market over the neighboring Group.  However, I don’t expect to see diesel prices go any lower as refinery maintenance finishes and harvest season approaches.

Propane prices continue to remain low, low, low.  The national inventory showed another large build and we are well on our way to breaking an inventory supply record this year.  If there is no major corn drying demand event, early cold, or nasty winter, I expect propane prices to remain low all winter.  Now next year will be a different story as additional exporting hubs and pipelines will be in full operation.  So for now, enjoy the lower prices of this season!  If you have not filled your tank to start the season, please do so!

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

Best regards,

Jon Crawford – Pres.