MARKET ANALYSIS
AS PREPARED BY COMMISSION STAFF
March 31, 2016

 

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 17

 $ 40.20

$ 41.54
 

Mar 18

 $ 39.44

$ 41.20
 

Mar 21

 $ 39.91

$ 41.54
 

Mar 22

 $ 41.45

$ 41.79
 

Mar 23

 $ 39.79

$ 40.47
 

Mar 24

 $ 39.46

$ 40.44
 

Mar 28

 $ 39.39

$ 40.27
 

Mar 29

 $ 38.28

$ 39.14
 

Mar 30

 $ 38.32 $ 39.26
 Average Brent Crude for March: $ 39.80
 
West Texas Intermediate
  Average Average Average Average
  2016 2015 2014 2013
January  $ 31.67  $ 47.56  $ 94.73  $ 94.70
February  $ 30.45  $ 50.78  $100.57  $ 95.50
March  $ 37.94  $ 47.87  $100.46  $ 92.73
April    $ 54.63  $102.15  $ 89.59
May    $ 59.37  $101.79  $ 94.93
June   $ 59.76  $105.14  $ 95.76
July   $ 50.93 $102.39  $104.68
August   $ 42.89 $ 96.08  $106.49
September   $ 45.48 $ 93.03  $106.24
October   $ 46.29 $ 84.52  $100.74
November   $ 42.94 $ 77.55  $ 94.00
December   $ 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 30/16 $ 38.32 90.7 72.7 103.4
Mar 30/15 $ 48.68 105.1 89.2 122.9
YOY Diff. -10.36 -14.4 -16.5 -19.5
% Change -21.3% -13.7% -18.5% -15.9%

Commentary:


Crude futures remained relatively stable in the high $30 per barrel range for both Brent and WTI over the past two weeks.  Recent talks of an OPEC/Russia cooperative production freeze have accounted, for the most part, for the rise in prices from the low $30 per barrel level experienced in late February.  Speculative activity, of course, can account for daily observed fluctuation but the predominant influence continues to be market preoccupation with global oversupply.  Indeed, late in the past two week period, activity on the part of Kuwait and Saudi Arabia to reopen a previously abandoned oil production field generated doubt as to OPEC's resolve to honor production freeze commitments and resulted in a fall off in market crude pricing.

With regard to refined products, maintenance related refinery interruptions and continued increased demand have provided an upward pressure on gasoline prices.  Mild weather related surpluses of distillate inventories, on the other hand, have served to depress furnace oil and diesel pricing.

Economic Data:

1. Platts Inventory Update:

The US Energy Department ("DOE") weekly petroleum inventory assessment, issued March 30, 2016, reported an increase in US crude stocks of 2,299,000 barrels.

US gasoline inventories decreased by 2,510,000 barrels over the previous reporting period. Implied demand decreased by 259,000 b/d.

US distillate inventories decreased by 1,075,000 barrels.  

US refinery utilization rates increased by 2.0% to 90.4% of capacity.

 
 

 

Weekly
(bbl)

Year over Year
% Change
 

Crude

 +2,299,000 +13.4%
 

Gasoline

 -2,510,000 +5.9%
 

Distillates

 -1,075,000 +26.7%
Source: DOE March 30, 2016

Note:

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