Posted on 08/03/2016 9:58:37 AM PDT by bananaman22
Summer driving season: it’s the season to be traveling, what with long weekends, annual leaves and short getaways from the banalities of everyday life at the office. The summer season in the Northern Hemisphere is when demand for crude oil invariably picks up, because fuel consumption increases. In Europe, there’s greater hunger for diesel and in the U.S. there’s a pickup in gasoline demand. Usually.
This year’s driving season, however, is shaping up to be a very disappointing exception to the usual seasonal patterns in fuel demand. People are not traveling now as much as analysts expected back in May. Back then, the outlook was rosy, with some analysts forecasting an oil rebound to as much as $60 a barrel. Instead, we got WTI slipping into bear market.
The driving season ends next month, which is when most refineries shut down for maintenance after operating at near-full capacity during the summer months. This is—historically—when gasoline demand subsides. The end of summer travels is also when gasoline stockpiles in the U.S. could increase, further pushing down crude oil prices.
(Excerpt) Read more at oilprice.com ...
Nah.
Supply will dwindle as refineries shift to “winter blend” and need maintainance.
You are precisely right.
Neither the Saudis or the Russians can afford to quit pumping; neither can ISIS or the Iraqis, no matter how low prices go. Meanwhile, the guys in west Texas and in Oklahoma are making profits on their old wells and can do so even if prices go to $10. (Of course, new wells are going to cost a lot more than that, and workovers aren’t cheap).
...Neither the Saudis or the Russians can afford to quit pumping; neither can ISIS or the Iraqis, no matter how low prices go.
Should we take the lesson to get Government out of the free market? (Examples of Government Motors, Fannie Mae home mortgages, Sallie May student loans, Obamacare medical insurance, and other business-strangling regulations)
Retail price for regular unleaded reached a low of $1.52 here, and is just now breaking below $2.00 after reaching $2.20. Seeing price declines in July told me that the so-called summer driving season was a bust.
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