Summer Fuel Price News – With spring fast upon us, projections from experts are abundant on what to expect when it comes to vehicle gas prices as we look ahead to summer. One thing’s for sure: the new Trump administration will affect market dynamics – it’s just not clear yet in which ways. According to Alan Levine and Brian Milne, here are the latest opinions on crude, gasoline, diesel (heating oil), propane and natural gas as reported by Fuel Marketer News (FMN).
Crude
As of now, crude is at between $50 and $55 per barrel, with an abundant supply of crude not only in the United States but throughout the world as well. Many factors may stabilize crude prices in the coming months. One of those points to OPEC’s recent production cuts which are keeping prices up.
There are claims of high levels of compliance by overseas producers, mainly from Saudi Arabia and maybe even Russia. Saudi Arabia has said they would be open to deeper cuts in production if cheating goes on the rise again. On a related note, shale oil technology is getting even more efficient each year, but it’s still more costly than conventional oil.
Gasoline
There’s plenty of supply in this regard, yet weak demand. Gas supply is actually the second highest on record, with too much gasoline flooding the market. Retail prices are higher by 50 cents now than the same time last year. Good news though: a big boost to the economy should happen as we head into summer. That’s because employment is on the rise with more job gains on the horizon.
Also, mileage improvements within the automotive industry thanks to the Corporate Average Fuel Economy (CAFE) standards are preventing excessive demand.
Gasoline exports to Mexico are increasing, as their demand grows due to a stronger economy there. Overall, gasoline prices will stay stable into the summer, when an increase is likely to occur, with an average price of $2.39/gal in 2017.
Diesel
Diesel fuel, commonly known as a commercial fuel, has also been fairly stable with high demand for distillates except in the area of No. 2 heating oil. This is due in part to warmer-than-normal January temperatures, with distillate consumption at the third-lowest level in the last 15 years. Growth in this area can drive demand for diesel.
Propane
Propane is forecast to lead exports because it’s currently a very strong product. In fact, now’s the time to buy propane. The cost of propane is expected to be about 10 to 12 cents cheaper in one year. It’s also emerging as an alternative fuel in industries like road construction and landscape work.
Natural Gas
Natural gas is growing in demand, outpacing supply within this country for the first time in Dec. 2016. Part of that reason is the mild weather we’ve been having this winter. LNG exports will also impact the prices and demand of natural gas over the course of the Trump administration should the trade policy support it.
Got more questions about summer fuel prices? Call Taylor Oil today.