MARKET ANALYSIS
AS PREPARED BY COMMISSION STAFF
 March 14, 2017

 

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)
    WTI Brent
 

Mar 1

 $ 53.83

$ 56.36
 

Mar 2

 $ 52.61

$ 55.08
 

Mar 3

 $ 53.33

$ 55.90
 

Mar 6

 $ 53.20

$ 56.01
 

Mar 7

 $ 53.14

$ 55.92
 

Mar 8

 $ 50.28

$ 53.11
 

Mar 9

 $ 49.28

$ 52.19
 

Mar 10

 $ 48.49

$ 51.37
 

Mar 13

 $ 48.40

$ 51.35
 Average Brent Crude for March: $ 54.14
 
West Texas Intermediate
    Average Average Average Average
  2017 2016 2015 2014 2013
January  $ 52.60  $ 31.78  $ 47.56  $ 94.73  $ 94.70
February $53.43  $ 30.62  $ 50.78  $100.57  $ 95.50
March $51.40  $ 37.96  $ 47.87  $100.46  $ 92.73
April    $ 41.12  $ 54.63  $102.15  $ 89.59
May    $ 46.80  $ 59.37  $101.79  $ 94.93
June    $ 48.85 $ 59.76  $105.14  $ 95.76
July    $ 44.95 $ 50.93 $102.39  $104.68
August    $ 44.80 $ 42.89 $ 96.08  $106.49
September    $ 45.23 $ 45.48 $ 93.03  $106.24
October    $ 49.94 $ 46.29 $ 84.52  $100.74
November    $ 45.81 $ 42.94 $ 77.55  $ 94.00
December    $ 52.17 $ 37.33 $ 59.82  $ 97.87
         
  US $
Per Barrel		 CDN  Cents
Per Litre		 CDN Cents
Per Litre		 CDN Cents
Per Litre
  CRUDE RUL F/O DIESEL
Mar 10, 2017 $ 48.49 106.6 80.4 117.3
Mar 10, 2016 $ 37.84 85.0 69.6 99.9
YOY Diff. +10.65 +21.6 +10.8 +17.4
% Change +28.1% +25.4% +15.5% +17.4%

Commentary:


After having demonstrated relative stability since the beginning of the year, crude prices dropped between 8-9% over this past two week period, with WTI now trading below $50.00 per barrel.  A steadily increasing US drill rig activity, rising US DOE reported crude inventory balances and indications that Russia was not keeping its commitments to curb production all combined to trigger an investor sell-off which served to deflate crude prices over the latter part of the past two weeks.

With regard to refined product, adequate inventory levels, a milder than normal winter relative to furnace oil and diesel and off-season driving patterns relative to gasoline have served to depress refined product pricing.

 

Economic Data:

1.  Platts Inventory Update:

The US Energy Department ("DOE") weekly petroleum inventory assessment, issued March 8, 2017, reported an increase in US crude stocks of 8,209,000 barrels.

US gasoline inventories decreased by 6,555,000 barrels over the previous reporting period.  Implied demand increased 582,000 b/d.
 
US distillate inventories decreased by 2,676,000 barrels.

US refinery utilization rates decreased by 0.1% to 85.9% of capacity.

 

 

Weekly
(bbl)

Year over Year
% Change

Crude

 +8,209,000 +7.7%

Gasoline

 -6,555,000 -0.5%

Distillates

 -2,676,000 -0.6%
Source: DOE March 8, 2017
 

Note:

Legend:
DOE Department of Energy
RUL Regular Unleaded Gasoline
F/O Furnace Oil
WTI West Texas Intermediate