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Oil & Propane Prices Today

U.S. retail gasoline prices fall heading into Labor Day, following crude prices lower (8/27/2014)
The U.S. average retail price for regular gasoline was $3.45/gallon (gal) this past Monday, the lowest price on the Monday before Labor Day since 2010 (Figure 1). The average price at the pump is now 25 cents/gal lower than it was at the end of June. A lower North Sea Brent crude oil price is the main driver of the decline in the gasoline price. The current price of Brent is lower than it was both in June 2014 and heading into the Labor Day weekend last year (Figure 2). ...

Increased production and infrastructure constraints open crude oil price spread between Midland and Cushing (8/20/2014)
Increasing production of crude oil in the Permian Basin has outpaced pipeline infrastructure to move the crude to refineries, causing prices for crude in the Permian (at Midland, Texas) to fall below similar crudes priced at Cushing, Oklahoma (Figure 1). While the discount of Midland prices to Cushing prices has been increasing for almost a year, recent refinery outages in the region have caused it to widen substantially. Several infrastructure projects that will allow more crude to flow from the Permian to the U.S. Gulf Coast are expected to come online soon, which should narrow the discounts of crude oil at Midland. ...

Midwest propane inventories show strong growth in recent weeks (8/13/2014)
Last winter, high propane prices, low inventories and logistical and infrastructure challenges prompted emergency measures to address propane supply shortfalls in the Midwest. Given the severity of last winter's supply challenges, market participants are paying close attention to the adequacy of propane supplies to meet agricultural and heating demands this coming season. While the high-demand season is still some months away, an analysis of propane inventory levels, along with an assessment of propane prices and changes in infrastructure and supply flows, provides some insight into the emerging supply picture. ...

Diverging U.S. and global crude oil market fundamentals cause WTI and Brent prices to converge (8/6/2014)
Market fundamentals influencing U.S. and global oil markets have diverged this summer. Record-high seasonal refinery runs and low inventories in the United States have put upward pressure on prices of U.S. domestic crudes West Texas Intermediate (WTI) and Light Louisiana Sweet (LLS), while low demand in Europe and Asia and unplaced West African crude oil cargoes have depressed North Sea Brent prices. As a result, the Brent-WTI spread has narrowed, with WTI prices briefly reaching a premium to Brent prices for the first time since August 2010. While WTI prices quickly returned to a discount to Brent, the Brent-WTI spread remains relatively narrow, with the July spread averaging $3.92/barrel, the lowest level this year and almost 50% below the 2014 average. ...