Booming Energy Output to Shrink U.S. Trade Gap

As you may have heard, international trade has become something of a heated issue. President Trump left last weekend’s G7 meeting in Canada angry over the protectionist policies of some of America’s closest allies, which he emphasized by refusing to endorse the group’s written statement on shared economic, trade and environmental aspirations. Leaders of the other G7 members – the world’s seven most advanced economies – were none too pleased themselves, blaming Trump for what they viewed as undue hostility and breaches of diplomatic protocol.

It’s a fight I’ll leave to others. Reasonable people can disagree over how fairly or unfairly U.S. exports are treated by other countries. But I will note that, when it comes to foreign sales of U.S. energy products, the future looks very rosy. Continue reading “Booming Energy Output to Shrink U.S. Trade Gap”

Your Memorial Day Weekend Road Trip Just Got More Expensive

If you’re hitting the road this holiday weekend, buckle up for the highest gas prices in several years. AAA’s website reports that the national average price of regular unleaded gas has climbed to $2.96, the highest level since late 2014. (Of course, some parts of the country are already paying quite a bit more. The national average encompasses a wide range of prices.) A year ago, the price at the pump averaged a much more wallet-friendly $2.37 per gallon, according to AAA.

And prices probably aren’t done climbing. Last month, I warned that the national average was likely to reach $3 this spring. That likely will hit Memorial Day weekend. Crude oil prices continue edging up, but such increases generally don’t reach the pump until a week or two later. Continue reading “Your Memorial Day Weekend Road Trip Just Got More Expensive”

Gasoline Prices Nearing Multiyear Highs

If you fill up your car’s gas tank with any regularity, you don’t need me to tell you that prices at the pump are on the rise. AAA reports that the national average price of regular unleaded now stands at $2.72 per gallon, up from $2.54 a month ago and $2.41 this time last year. (That national average contains a lot of regional variability. In California, for instance, regular sells for $3.55. In South Carolina, just $2.49.)

Will the run-up keep going? And just how high will prices get? Continue reading “Gasoline Prices Nearing Multiyear Highs”

What To Make Of the Oil Market Stumble

It’s not just the stock market that tumbled this week. Crude oil prices are down sharply, too. But is this the end of the “epic price rally” that I wrote about two weeks ago?

Benchmark West Texas Intermediate crude has fallen by more than 10% from its Jan. 26th peak of $66 per barrel. Much of that selloff has coincided with the sudden drop in stock prices that began a week ago. This week, when the Dow Jones Industrial Average saw its two biggest single-day point drops in history, WTI came along for the ride. Continue reading “What To Make Of the Oil Market Stumble”

What’s Fueling Oil’s Big Rally?

If you follow the energy markets at all, you already know that crude oil is enjoying an epic price rally. In mid-July of last year, benchmark West Texas Intermediate crude was trading at $45 per barrel. Six months later, WTI has zoomed to $64 per barrel: A heady 40% advance, which makes the stock market look positively pedestrian by comparison.

So, what gives? And more importantly, can the rally continue? Continue reading “What’s Fueling Oil’s Big Rally?”

Where Do Oil Prices Go Next?

The oil market has been nothing if not volatile this autumn. At the beginning of September, the price of benchmark West Texas Intermediate hovered near $47 per barrel after spending most of the summer trading in the mid-$40s. Then suddenly, in the wake of Hurricane Harvey, WTI went on a tear, shooting up to $57 per barrel by early November: A tidy 21% gain at a time when oil demand tends to be low.

Had crude finally begun a sustained rebound after several years of depressed prices? Many oil bulls seemed to think so. Or at least, many did until earlier this week, when WTI dropped sharply after the International Energy Agency issued a prediction that global oil demand will grow more slowly next year than previously expected. Are oil prices just taking a breather before the next leg up? Or did this week’s drop mark the end of the autumn rally? Continue reading “Where Do Oil Prices Go Next?”

U.S. Oil Exporters Cash in on Higher Prices, Strong Demand

Here’s something the oil market hasn’t seen lately: A price rally.

After falling as low as $46 per barrel on Aug. 30, when Hurricane Harvey forced Gulf Coast refineries to shut down, benchmark West Texas Intermediate crude oil has soared to about $57 per barrel. The price run-up reflects several factors: Improving economic growth around the world; hints from OPEC that its current policy of limiting crude exports will continue for longer than first scheduled; and turmoil in Saudi Arabia, where several high-ranking officials and members of the royal family have been arrested on corruption charges. (Anything that threatens the internal stability of OPEC’s largest oil producer is bound to raise concerns about potential interruptions in crude shipments.) Continue reading “U.S. Oil Exporters Cash in on Higher Prices, Strong Demand”

Budget More to Keep Warm This Winter

This past August, I checked in on supply levels for the three main heating fuels: Natural gas, heating oil and propane. The key takeaway: While shortages are unlikely, there’s less of all three fuels in storage this year than last year, which creates the potential for higher prices.

Now that the calendar says October and there’s a chill in the air across much of the country, what should energy users be expecting when it comes to prices and heating costs this winter? Continue reading “Budget More to Keep Warm This Winter”

Hurricane Harvey Wallops the Energy Industry

The rain is still falling along the Gulf Coast and the flood waters are still rising, but it’s already clear that Hurricane Harvey has crippled the region’s energy infrastructure. As I wrote last week, many of the country’s oil refineries are located along the coasts of Texas and Louisiana. The latest reports indicate that more than 10% of U.S. refining capacity is now offline because of flooding and closures of shipping channels, roads and railways.

Retail gasoline prices are already starting to show the effects of refinery outages. According to AAA, the nation’s average price for regular unleaded now stands at $2.38 per gallon, up 4 cents from a week ago. Gasoline futures contracts are showing even steeper gains, signaling that drivers can expect prices at the gas station to keep rising in the next few days. Continue reading “Hurricane Harvey Wallops the Energy Industry”

What Hurricane Harvey Means For Gas Prices

Residents living along the western Gulf of Mexico are no doubt carefully monitoring Hurricane Harvey, which is forecast to come ashore somewhere along the Texas coast Friday with flooding rains, powerful winds and damaging storm surges. It’s a dangerous situation for a region that hasn’t seen a hurricane since Ike in 2008.

Motorists throughout the U.S. might want to keep an eye on the storm’s impact, too. Why? Because the western Gulf is home to almost half of the country’s oil refining capacity. If flooding causes power outages or otherwise hobbles refineries, the production of gasoline and other fuels will take a significant hit. Continue reading “What Hurricane Harvey Means For Gas Prices”