MARKET ANALYSIS
AS PREPARED BY COMMISSION STAFF
December 14, 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
 

Dec 2

 $ 51.68

$ 54.46
 

Dec 5

 $ 51.79

$54.94
 

Dec 6

 $ 50.93

$ 53.93
 

Dec 7

 $ 49.77

$ 53.00
 

Dec 8

 $ 50.84

$ 53.89
 

Dec 9

 $ 51.50

$ 54.33
 

Dec 12

 $ 52.83

$ 55.69
 

Dec 13

 $ 52.98

$ 55.72
 

 

  

 
 Average Brent Crude for December: $ 54.43.
 
West Texas Intermediate
  Average Average Average Average
  2016 2015 2014 2013
January  $ 31.78  $ 47.56  $ 94.73  $ 94.70
February  $ 30.62  $ 50.78  $100.57  $ 95.50
March  $ 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  $ 51.49 $ 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
Dec 9/16 $ 51.50 108.70 78.9 117.3
Dec 9/15 $ 37.16 99.6 79.7 111.3
YOY Diff. +14.34 +9.1 -0.8 +6.0
% Change +38.6% +9.1% -1.0% +5.4%

Commentary:


Crude pricing continues to escalate as the market digests the impact of the November 30 OPEC deal to reduce global oil production by 1.2 mm bpd and the recently signed non-OPEC country deal to cut an additonal 600,000 bpd. Brent and WTI have now appreciated 10% and 7% respectively since November 30.

Refined product futures have reacted instinctively with wholesale rack prices for both gasoline and distillates having risen over the past two weeks. Off-season demand for gasoline and a mild weather winter thus far should serve to mitigate such upward pressure going forward over the near future.

 

Economic Data:

1.  Platts Inventory Update:

The US Energy Department ("DOE") weekly petroleum inventory assessment, issued December 7, 2016, reported a decrease in US crude stocks of 2,389,000 barrels.

US gasoline inventories increased by 3,425,000 barrels over the previous reporting period.  Implied gasoline demand decreased in this reporting period by 323,000 b/d.
 
US distillate inventories increased by 2,501,000 barrels.  


US refinery utilization rates increased by 0.6% to 90.4% of capacity.

 

 

Weekly
(bbl)

Year over Year
% Change

Crude

 -2,389,000 +7.1%

Gasoline

 +3,425,000 +5.5%

Distillates

 +2,501,000 +4.9%
Source: DOE December 7, 2016
 

Note:

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