MARKET ANALYSIS
AS PREPARED BY COMMISSION STAFF
February 14, 2012

 

The following analysis has been used by the Commission as part of its price adjustment methodology and is provided here to assist the public in understanding some of the background factors influencing current market prices.

 
 

Crude Track:
  Recent Crude (US$/bbl)
 

Jan 31

$98.48
 

Feb 1

$97.61
 

Feb 2

$96.36
 

Feb 3

$97.84
 

Feb 6

$96.91
 

Feb 7

$98.41
 

Feb 8

$98.71
 

Feb 9

$99.84
 

Feb 10

$98.67
 
 
  Average Average Average
  2012 2011 2010
January  $100.51  $89.44  $78.40
February  $98.04  $88.83  $76.16
March    $102.74  $81.12
April    $109.67  $84.46
May    $101.29  $74.14
June    $96.40  $75.39
July    $97.43  $73.95
August    $86.23  $77.00
September    $86.13  $75.55
October   $86.10  $81.99
November   $96.86  $84.25
December   $98.51  $89.09
         
  US $
Per Barrel		 CDN  Cents
Per Litre		 CDN Cents
Per Litre		 CDN Cents
Per Litre
  CRUDE RUL F/O DIESEL
Feb 10/12 $98.67 121.7 106.3 131.7
Feb 10/11 $86.73 109.9 92.9 120.1
YOY Diff. +11.94 +11.8 +13.4 +11.6
% Change +14% +11% +14% +10%

Commentary:

1. Platts Inventory Update:


The most recent weekly US Energy Department ("DOE") petroleum inventory assessment, issued Feb. 8, 2012, reported a small increase in US crude petroleum inventories. US crude oil inventories rose slightly by 304,000 barrels. US gasoline inventories rose 1.629 million barrels. US distillate product (diesel and heating oil) inventory rose by 1.174 million barrels. The increase in crude imports was offset by increased refinery production rates and a drop in product demand. Refinery utilization rates reversed a 3-week trend of declining utilization. Refinery utilization increased by 1.0 percentage point to 82.8%. 

Implied demand for gasoline increased marginally over the previous week but remains below the five-year average. The rise in distillate product stocks occurred in the US Gulf coast PAD district. Distillate product inventory on the US Atlantic coast PAD district remains significantly below year ago levels.


DOE Report:

 

 

 

Weekly (bbl)

Year over Year
 

 Crude

 +304,000 -1.7%
 

 Gasoline

 +1,629,000 -3.8%
 

Distillates

 +1,174,000 -10.8%

 

2.  U.S Economic Highlights:
 

  • MasterCard's weekly SpendingPulse survey showed US gasoline demand declined 2.8% last week and is more than 5 percent below year ago levels.

  • US retail gasoline prices have risen by an average 11.57 cents over the past three weeks. These increases have occurred despite declining gasoline demand. Market analysts attribute the price increases to:

    1. continued European financial restructuring implications,
    2. tensions between Europe and Iran over Iran's nuclear program, and
    3. the potential of US supply shortages this summer associated with recent and planned closures of certain US refineries.

  • Some analysts are suggesting that this summer's driving season could see the most expensive gasoline in US history.


3.  Other:
 
  • The commodity market pricing for crude reacted positively to the news that Greece passed recent budget proposals imposed by the European Union.

  • China, the world's second-largest oil consumer, reported record levels of oil imports in January 2012. China is expected to increase oil imports in 2012 as its refining capacity expands to meet domestic growth. China's oil import demand is expected to increase by 5% this year.

Note:

Legend:
DOE Department of Energy
RUL Regular Unleaded Gasoline
F/O Furnace Oil