MARKET ANALYSIS
AS PREPARED BY COMMISSION STAFF
September 30, 2011

 

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)
 

Sep 19

$85.70
 

Sep 20

$86.89
 

Sep 21

$85.92
 

Sep 22

$80.51
 

Sep 23

$79.85
 

Sep 26

$80.24
 

Sep 27

$84.45
 

Sep 28

$81.21
 

Sep 29

$82.14
 
 
  Average Average Average
  2011 2010 2009
January  $89.44  $78.40 $41.96
February  $88.83  $76.16 $38.58
March  $102.74  $81.12  $47.96
April  $109.67  $84.46  $49.82
May  $101.29  $74.14  $55.96
June  $96.40  $75.39  $69.60
July  $97.43  $73.95  $63.93
August  $86.23  $77.00  $71.04
September  $86.13  $75.55  $69.08
October    $81.99  $75.56
November    $84.25  $78.31
December    $89.09  $73.88
         
  US $
Per Barrel		 CDN  Cents
Per Litre		 CDN Cents
Per Litre		 CDN Cents
Per Litre
  CRUDE RUL F/O DIESEL
Sep 28/11 $81.21 122.7 99.9 123.9
Sep 28/10 $76.18 100.6 78.3 102.8
YOY Diff. +5.03 +22.1 +21.6 +21.2
% Change +6.6% +22% +27.6% +20.6%

Commentary:

1. Platts Inventory Update:


The weekly U.S. Energy Department ("DOE") petroleum inventory assessment report, issued September 28, 2011 showed U.S. crude stocks with an increase of 1.915 million barrels. The inventory increase is attributed to a rise in imports and a slow down in U.S. refining operations. Gasoline stocks showed an inventory build associated with reduced implied demand. Inventory levels of distillate product increased by 72,000 barrels.  


DOE Report:

 

 

 

Weekly (bbl)

Year over Year
 

 Crude

 +1,915,000 -4.7%
 

 Gasoline

 +791,000 +3.5
 

Distillates

 +72,000 -9.2%


The most recent U.S. refinery utilization reports issued Sept. 28 noted a decline in capacity utilization to 87.8 percent. Philadelphia's Sunoco refinery (335,000 bpd) was shut down for maintenance issues during this period. ConocoPhillips on Tuesday yielded to the tough economic climate for East Coast refining, saying it would sell its refinery in Trainer, Pa., and shut down the facility in six months if it doesn't find a buyer. That facility will compete for buyers with two nearby refineries owned by Sunoco Inc., which earlier this month said it would idle the plants by July, 2012 if it hasn't sold them as it exits the refining business.

Together, the three refineries can process 700,000 barrels of crude oil per day, accounting for nearly half of the refining capacity on the East Coast and about 4% nationwide. The loss of that supply could push up gasoline prices and improve profit margins for some refiners, while also making the East Coast more dependent on gasoline imports.

2.  U.S. Economic Highlights:
 
  •  MasterCard Spending Pulse report issued September 27 noted continued declining demand for gasoline in the U.S. The most recent estimate is a decline of 2.7 percent over a year ago.
  •  Recent U.S. jobless new claims fell to lowest level since April 2, 2011 while continuing claims also fell this past week. While the unemployment rate still is at 9.1%, some economists were encouraged by the decline in jobless claims.

3.  Other:
 

  •  German lawmakers approved further economic assistance as part of an expansion to the Euro Bailout Fund. The German increase in its share of loan guarantees should encourage the remaining countries in the European Union to pass similar assistance law. Presently, of the 17 Euro zone countries, six remain unsigned to the financial guarantee extension.

Note:

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