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Housekeeping: Refinery Status Updated, DOE Report

I’ve taken some time to update the Refinery Status page with the latest knowledge of refinery issues, make sure to check it out by clicking the link at the top of the page “Refinery and U.S. Pricing Status”

Now, on to the DOE report, which was good, except for a few things.

The bad-
Refineries utilized just 85% of their capacity- the lowest in nearly two years… BUT gasoline inventories still gained by nearly 4 million barrels. We’re sitting just under last year in terms of gasoline stockpiles… still room for improvement before the spring run up!

The good-
Oil inventories rose, again… gasoline inventories rose, again.

Look for prices to fall back under $3 with ease. No concern for a price hike for some time.

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Florida Gas Prices- similar… slow falls expected

Good afternoon from Orlando, Florida!

Thanks to Ed for writing his predictions this week as I took a short respite from things.

I noticed in Florida, a state with NO refineries, prices similar/lower than Michigan. They also have higher demand while Michigan has lower demand due to the Winter weather… so what gives? Florida is not a “Speedway State”. They have zero Speedways, and therefore, no brute force raising prices.

I saw a low of 2.85 near Tampa, FL, and a almost incorrectly priced high of 3.29 in Pompano Beach, FL (I say almost incorrect due to the fact that 3 stations had that price and two blocks away, the price was 3.09… ODD!)

Anyway, the time off was nice, and Wednesday’s DOE report was equally nice, with a good gain in gasoline stockpiles (now above the average range for this time this year).

In other news, could Shell be artificially inflating prices in Australia? More on that later! I’ll see you in Grand Rapids soon!

Patrick

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DOE Report: Much more balanced this week, good gains!

Highlights from today’s weekly release of the DOE Petroleum Stockpile Data:

>Refineries operated at 87.1% of capacity… a huge decrease from the week previous!
>Gasoline production dropped roughly 200,000bpd compared to last week
>Crude oil imports seem on a rebound: they averaged 10 million barrels per day, about 220,000bpd higher than the same period last year

The GOOD news:
>Crude oil inventories rose by 4.3 million barrels (first gain in months- this is a large gain as well!)
>Gasoline inventories rose by 2.2 million barrels last week to put us in the upper constraints of the average range
>Distillate inventories rose by 1.1 million barrels, but continue to be outside the lower limit of the average range

The not-so-hot news:
>Total petroleum demand is up by 2.2% over the same period last year (even with high prices!)
>Gasoline demand for last week was up 1.2% over the same period last year (again- WITH the higher prices)

Other news:
The SPR (Strategic Petroleum Reserve) added a whopping 1.5 million barrels to its reserves, the largest increase I’ve ever seen (usually very small “injections” like 50,000-200,000 barrels). The U.S. is now sitting on 698.1 million barrels in its SP Reserve. This is the highest ever, and is sure to continue to grow as we inject as much oil as possible (capacity is somewhere north of 700 million barrels)

Look for oil and gasoline to drop today as continued worries about recession and news of large gains feed the bears…
There is still concern of a hike- not because of market conditions, but because of a loss of profit margin from local retailers that have dropped prices “too fast”. Watch for a reset to 2.99-3.05!

Patrick

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Just imagine- today- a 40 cent gas hike. Some in Washington WANT this!

Does this upset you? Let us know how you feel by leaving a comment below!

From the AP News Wire this morning:

By HOPE YEN, Associated Press Writer

WASHINGTON – A special commission is urging the government to raise federal gasoline taxes by as much as 40 cents per gallon over five years as part of a sweeping overhaul designed to ease traffic congestion and repair the nation’s decaying bridges and roads.

The two-year study being released Tuesday by the National Surface Transportation Policy and Revenue Study Commission, the first to recommend broad changes after the devastating bridge collapse in Minneapolis last August, warns that urgent action is needed to avoid future disasters. Under the recommendation, the current tax of 18.4 cents per gallon for unleaded gasoline would be increased annually for five years — by anywhere from 5 cents to 8 cents each year — and then indexed to inflation afterward to help fix the infrastructure, expand public transit and highways as well as broaden railway and rural access, according to persons with direct knowledge of the report, who spoke to The Associated Press on condition of anonymity because the report is not yet public.

The report also calls for rebuilding and expanding the national rail network to meet a growing demand for alternatives to congested highways. Continuing to apply patches to the nation’s aging infrastructure is “no longer acceptable,” and without dramatic changes, “the nation’s system of transportation will further deteriorate,” according to the
report, portions of which were read to the AP. But the 12-member commission’s proposals, which are expected to cost $225 billion each year for the next 50 years, face internal division. The commission’s chairwoman, Transportation Secretary Mary Peters, and two other members oppose gas tax increases and were issuing a dissenting opinion to the report calling instead for private-sector investment and tolls.

The gas tax has not been increased since 1993, and recent efforts by Congress to raise it have faltered over the objections of the Bush administration. The tax increase being proposed is designed to take effect in 2009, after President Bush leaves office. The commission was formed by Congress in 2005 to study the future needs of the nation’s surface transportation system, which includes roads, mass-transit systems, ports and rail lines — as well to recommend funding options. The report comes as state governments and several business groups, including the U.S. Chamber of Commerce and the National Association of Manufacturers, are calling on the federal government to raise gas taxes to pay for substantial transportation improvements. The Minneapolis bridge collapse, which killed 13 people and injured about 100, spotlighted the decaying infrastructure and drew new calls for additional spending.

Wow! I agree- something needs to be done to fix the roads, but how do we know this 40-cent per gallon increase in gasoline taxes will not be wasted on other budget items? They say the increase would be spread apart yearly, but would add up to 40 cents! The way things are looking, in a few years we’ll be dealing with $5 gasoline!

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Speedy Rewards: No clear answer! Upset? Leave a comment!

So rumors have been abundant about Speedway canceling its beloved Speedy Rewards program starting January 1. What has changed? I’m not sure. A few posts from GrandRapidsGasPrices.com got me curious- I had yet to hear about anything changing, so I went digging.

Here is what I’ve found so far:

Coupons violate state law mandated by Weights and Measures Department


(12/31/07)–The new year always bris with it change, but this you may
not want. At midnight New Year’s Eve, a popular way to get discounts at
the pump will be no more.

A representative from a local Speedway says the chain will no longer
offer fuel discount redemptions in the form of coupons or receipts.

The coupons violate a state law mandated by the Weights and Measures
Department. But if you use a Speedy Rewards Card at the pump you can
still get a deal on gas.

Speedway says it plans to accept the coupons customers already have until they expire.

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I e-mailed WOODTV to see if they’d pick up the story… more on that later.

Leave a comment and let us know how you feel! This sure isn’t going to help at all!

DOE Report: HUGE gasoline gain, huge oil loss… I’ll take it!

With the DOE’s weekly energy report being released just moments ago, here are some highlights:

>Refinery Utilization… YES!! Finally! 91.3% of capacity. This is JUST what we needed to slow the rise in gas prices!
>Gasoline Demand… rose 0.4% compared to the same time last year, which is quite surprising… last year we had (I’m sure you remember) very “cheap” gasoline (in fact, it bottomed out UNDER $2). Demand GREW this year with prices being nearly $1.50 more per gallon? What is going on America!?
>Oil inventories… Not good… dropped by nearly 7 million barrels. We’re looking at nearly 30 million barrels less of oil than just months ago. This number is significant and MAY support $100 oil
>Gasoline inventories… GOOD! Rose by over 5 million barrels to put us in the important ABOVE AVERAGE range for the first time in months! This will help slow the rise in retail prices.
>Distillate inventories (diesel and heating oil)… Good! Rose by 1.5 million barrels to bring them to the lower half of the average range.

We had, in my mind, a good DOE report, but the bulls might initiate another round of $100 oil as we start to see the effects of a loss in oil supply from OPEC. We really need OPEC to boost production now before we run into a bigger situation when spring rolls around!

Look for oil to distance itself from gasoline today.
Oil will trade higher, gasoline should fall. We’ll see!

Patrick

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