Update a year of volatility oil markets and gasoline
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Update: A Year of Volatility Oil Markets and Gasoline PowerPoint PPT Presentation


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Update: A Year of Volatility Oil Markets and Gasoline. June 20, 2000 Energy Information Administration. Retail Product Prices Driven by Crude. $34/Barrel. $11/Barrel. Gasoline Prices in Inflation-Adjusted Terms.

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Update: A Year of Volatility Oil Markets and Gasoline

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Update: A Year of VolatilityOil Markets and Gasoline

June 20, 2000

Energy Information Administration


Retail Product Prices Driven by Crude

$34/Barrel

$11/Barrel


Gasoline Prices in Inflation-Adjusted Terms

Source: BLS Regular Gasoline, EIA Refiners Acquisition Price for Imported Crude Oil


Crude Oil Prices High But May Relax Some By Year’s End

West Texas Intermediate

Sources: History: EIA; Projections: Short-Term Energy Outlook, June 2000.


EIA OPEC Production Assumption Projects Increasing Leakage

Sources: History: EIA; Projections: Short-Term Energy Outlook, June 2000.


Supply/Demand Forecasts Leave Little Room for Winter Drawdown


Price Volatility Will Remain Until Inventories Rebuild


Low Stocks Mean Tight Markets


Tight Markets Lead to High Gasoline Spreads


MidWest RFG Price Rose Quickly


Midwest RFG Production Somewhat Low


Midwest Conventional Stocks Very Low; RFG Not As Extreme


Regional Inventories Low


Midwest RFG Is Small Fraction Of Market & Is “Unique” Blend

East Coast

Midwest

EIA Prime Supplier Data 1999 For Period After MO Entered the Program


While Gasoline Has the Limelight, Distillate Is Being Watched


Natural Gas Supply Concerns Driving Up Prices


Conclusion: Volatile Prices Likely in the Year Ahead

  • Gasoline markets: Low stocks, high prices, volatility

  • Winter heating fuel: May have low inventories going into winter, resulting in price volatility

  • Natural gas: High prices and supply concerns may impact distillate stock build for winter and can mean high natural gas prices this winter

  • But maybe OPEC will add more supply, stocks will build, and prices will fall


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