MARKET ANALYSIS
AS PREPARED BY COMMISSION STAFF
March 28, 2013

 

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 WTI Crude (US$/bbl)
 

Mar 15

$93.45
 

 Mar 18 

$93.74
 

Mar 19

$92.16
 

Mar 20

$92.96
 

Mar 21

$92.45
 

Mar 22

$93.71
 

Mar 25

$94.81
 

Mar 26

$96.34
 

Mar 27

$96.58
 Average Brent Crude for March: $109.52.
 
  Average Average Average
  2013 2012 2011
January  $ 94.70  $100.51  $89.44
February  $ 95.50  $102.26  $88.83
March  $ 92.73  $106.36  $102.74
April    $103.18  $109.67
May    $ 95.47  $101.29
June    $ 82.28  $96.40
July    $ 87.93  $97.43
August    $ 94.05  $86.23
September    $ 94.74  $86.13
October    $ 89.72 $86.10
November    $ 85.87 $96.86
December    $ 88.06 $98.51
         
  US $
Per Barrel		 CDN  Cents
Per Litre		 CDN Cents
Per Litre		 CDN Cents
Per Litre
  CRUDE RUL F/O DIESEL
Mar 27/13 $ 96.58 128.3 109.7 134.7
Mar 27/12 $107.33 127.6 108.7 133.4
YOY Diff. - 10.75 +0.7 +1.0 +1.3
% Change -10.0% +0.5% +1.0% +1.0%

Commentary:


1. Platts Inventory Update:

The U.S. Energy Department ("DOE") petroleum inventory assessment, issued March 27, 2013, reported an increase in U.S. commercial crude stocks of 3.2 million barrels.  The U.S. crude stock increase is attributed to an increase in imports.  U.S. domestic production remained unchanged from the previous reporting period.  U.S. refinery utilization increased by 2.2 percent to 85.7%.  U.S. gasoline inventories declined as implied demand outpaced production and imports of refined product.  Distillate inventories decreased significantly despite increased imports as demand rose sharply.


DOE Report:

 

 

 

Weekly
(bbl)

Year over Year
% Change

      
 

Crude

 +3,256,000 +9.2%      
 

Gasoline

 -1,590,000 -0.9%      
 

Distillates

 -4,513,000 -15.2%      
Source: DOE March 27, 2013

Crude trading values have climbed over the past two weeks having increased $3.82 per barrel or 4% since March 13. Conflicting European, North American and Chinese economic data, increased market tension related to the banking crisis in Cyprus and a falling U.S. dollar have contributed to same.

Refined product prices, however, have receded since mid-March. With regard to gasoline, dumping of surplus winter grade gasoline product prior to onset of summer blend gasoline has been the story. Meanwhile, the return of North American refining capacity after seasonal maintenance activity and the cessation of winter weather have combined to relieve pressure on wholesale furnace oil and diesel prices.

Looking forward, increased production costs associated with summer grade gasoline specifications and increased seasonal demand will exert upward pressures on gasoline prices though, at the moment, the anemic U.S. economy has put a damper on market anticipation with gas futures currently indicating relative stability over the next 60 days.

Note:

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