Energy Market Update September 13, 2017
Inc.
Energy Market Update September 13, 2017 NYMEX Prices Close October Crude Oil Crude Oil October Gasoline October Heating Oil October Natural Gas
$49.30 $1.6473 $1.7685 $3.058
Wk. Change +$0.19 -$0.0297 +$0.0088 +$0.055
MARKET COMMENTS: A lackluster day for the products, but crude futures got a boost after the International Energy Agency said a global surplus of crude was beginning to show signs of shrinking and global demand growth has been better than expected. In addition, OPEC is said to be considering an extension of their production deal beyond their March deadline. Elsewhere, traders are still hesitant to give much credibility to the DOE inventory report given the inventory displacement during Hurricane Harvey. Crude Change DOE EST. Propane
API’s
+4.3
3Yr Avg. 468.2 447 +15.00/-3.700 Total
Gasoline
5 Yr. Avg. 412
Total 82.2 +2.4 Crude +6.181 Cushing +1.320
Change
-8.4
3Yr Avg. 220 218.3 +4.700/-8.00 Total
Distillate Fuel
5 Yr. Avg. 215
Change
-3.2
3Yr Avg. 144.6 143 +2.200/-4.00 Total
Midwest 25.8 +1.4
Gulf 46.7 +1.1
Gasoline -7.896
Distillates -1.805
Despite large builds in nationwide inventories, propane prices continue to stay elevated as it relates to crude oil. The DOE reports continue to leave traders with a lot of questions, largely as it relates to exports and the speed at which those have resumed. Some sources say that although ships have resumed loading, it’s unclear whether they are leaving full given draft restrictions along several Gulf Coast waterways.
5 Yr. Avg. 137
Crack spreads have been on a wild ride since the arrival and departure of Hurricane Harvey, falling to more “normalized” last week. Crack spreads are expected to stay elevated in the coming weeks getting help from favorable DOE reports, likely more reports of refinery restart problems and gasoline demand improvement after the economies of Houston and South Florida get back to normal.
The 8 to 14 day weather forecast, which is valid through September 24th, is calling for above normal temperatures throughout much of the Midwest. The warmer temperatures will likely be welcomed by producers, as they are hoping for moisture levels to start dropping prior to harvest.
About 60% of the shuttered refining capacity along the Gulf Coast is reportedly back up and running as of Tuesday. However, supply disruptions and refinery outages caused by Hurricane Harvey continue to affect gasoline supply and prices, particularly along the U.S. East Coast and the Gulf Coast, where gasoline prices are 39 cents/gal and 35 cents/gal higher, respectively, than they were a week ago. Compared with other hurricanes that have made landfall in the United States since 2000, Hurricane Harvey’s impact on U.S. Gulf Coast retail gasoline prices have been on par with the impact from Hurricanes Katrina and Rita. In August 2005, gasoline spot prices rose nearly 30% in one trading day after the landfall of Hurricane Katrina in Louisiana.
Energy Market Update September 13, 2017 NYMEX Prices Close October Crude Oil Crude Oil October Gasoline October Heating Oil October Natural Gas
$49.30 $1.6473 $1.7685 $3.058
Wk. Change +$0.19 -$0.0297 +$0.0088 +$0.055
MARKET COMMENTS: A lackluster day for the products, but crude futures got a boost after the International Energy Agency said a global surplus of crude was beginning to show signs of shrinking and global demand growth has been better than expected. In addition, OPEC is said to be considering an extension of their production deal beyond their March deadline. Elsewhere, traders are still hesitant to give much credibility to the DOE inventory report given the inventory displacement during Hurricane Harvey. Crude Change DOE EST. Propane
API’s
+4.3
3Yr Avg. 468.2 447 +15.00/-3.700 Total
Gasoline
5 Yr. Avg. 412
Total 82.2 +2.4 Crude +6.181 Cushing +1.320
Change
-8.4
3Yr Avg. 220 218.3 +4.700/-8.00 Total
Distillate Fuel
5 Yr. Avg. 215
Change
-3.2
3Yr Avg. 144.6 143 +2.200/-4.00 Total
Midwest 25.8 +1.4
Gulf 46.7 +1.1
Gasoline -7.896
Distillates -1.805
Despite large builds in nationwide inventories, propane prices continue to stay elevated as it relates to crude oil. The DOE reports continue to leave traders with a lot of questions, largely as it relates to exports and the speed at which those have resumed. Some sources say that although ships have resumed loading, it’s unclear whether they are leaving full given draft restrictions along several Gulf Coast waterways.
5 Yr. Avg. 137
Crack spreads have been on a wild ride since the arrival and departure of Hurricane Harvey, falling to more “normalized” last week. Crack spreads are expected to stay elevated in the coming weeks getting help from favorable DOE reports, likely more reports of refinery restart problems and gasoline demand improvement after the economies of Houston and South Florida get back to normal.
The 8 to 14 day weather forecast, which is valid through September 24th, is calling for above normal temperatures throughout much of the Midwest. The warmer temperatures will likely be welcomed by producers, as they are hoping for moisture levels to start dropping prior to harvest.
About 60% of the shuttered refining capacity along the Gulf Coast is reportedly back up and running as of Tuesday. However, supply disruptions and refinery outages caused by Hurricane Harvey continue to affect gasoline supply and prices, particularly along the U.S. East Coast and the Gulf Coast, where gasoline prices are 39 cents/gal and 35 cents/gal higher, respectively, than they were a week ago. Compared with other hurricanes that have made landfall in the United States since 2000, Hurricane Harvey’s impact on U.S. Gulf Coast retail gasoline prices have been on par with the impact from Hurricanes Katrina and Rita. In August 2005, gasoline spot prices rose nearly 30% in one trading day after the landfall of Hurricane Katrina in Louisiana.
