MARKET ANALYSIS
AS PREPARED BY COMMISSION STAFF
July 31, 2015

 

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
 

Jul 20

 $ 50.15

$ 56.65
 

Jul 21

 $ 50.36

$ 57.04
 

Jul 22

 $ 49.19

$ 56.13
 

Jul 23

 $ 48.45

$ 55.27
 

Jul 24

 $ 48.14

$ 54.62
 

Jul 27

 $ 47.39

$ 53.47
 

Jul 28

 $ 47.98

$ 53.30
 

Jul 29

 $ 48.79

$ 53.38
 

Jul 30

 $ 48.52

$ 53.31
 Average Brent Crude for July: $ 56.81.
 
West Texas Intermediate
  Average Average Average
  2015 2014 2013
January  $ 47.56  $ 94.73  $ 94.70
February  $ 50.78  $100.57  $ 95.50
March  $ 47.87  $100.46  $ 92.73
April  $ 54.63  $102.15  $ 89.59
May  $ 59.32  $101.79  $ 94.93
June $ 59.69  $105.14  $ 95.76
July $ 51.11 $102.39  $104.68
August   $ 96.08  $106.49
September   $ 93.03  $106.24
October   $ 84.52  $100.74
November   $ 77.55  $ 94.00
December   $ 59.82  $ 97.87
         
  US $
Per Barrel		 CDN  Cents
Per Litre		 CDN Cents
Per Litre		 CDN Cents
Per Litre
  CRUDE RUL F/O DIESEL
Jul 29/15 $ 48.79 119.0 78.9 111.6
Jul 29/14 $100.97 134.9 102.3 138.2
YOY Diff. -52.18 -15.9 -23.4 -26.6
% Change -51.7% -11.8% -22.9% -19.2%

Commentary:


Crude oil trading values continued to decline over this most recent two-week period with both Brent and WTI falling approximately 6% over the period. Continued strong U.S. domestic production, weak Chinese economic data, continued overproduction on the part of OPEC member nations, and a rising U.S. dollar have all contributed to current market dynamics.

In the wake of declining profitability from the sale of crude, fully-integrated oil companies (those having both crude extraction and refining capabilities) have been attempting to maximize profits available from the sale of finished products such as gasoline and diesel.

A well-supplied refined product market has served to keep market prices deflated for the most part thus far this summer—though the recovering U.S. economy and its associated increased consumption will bear watching. The DOE reported this week that U.S. demand for gasoline this past week was up 6% over the same period last year which resulted in an immediate upward pressure on the gasoline wholesale market.


Economic Data:

1. Platts Inventory Update:

The US Energy Department ("DOE") weekly petroleum inventory assessment, issued July 29, 2015, reported a decrease in US crude stocks of 4,200,000 barrels.

US gasoline inventories decreased by 365,000 barrels over the previous reporting period.

US distillate inventories increased by 2,600,000 barrels.  Implied gasoline demand decreased in this reporting period by 410,000 barrels/day.

US refinery utilization rates decreased by 0.4% to 95.1% of capacity.

 
 

 

Weekly
(bbl)

Year over Year
% Change
 

Crude

 -4,200,000 +25.1%
 

Gasoline

 -365,000 -1.1%
 

Distillates

 +2,600,000 +13.7%
Source: DOE July 29, 2015

Note:

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