Economic mixed signals abound allowing near term pricing direction to remain in limbo.
Wayne Gerdes -
CleanMPG - April 23, 2010
Fueling up the standard SUV still costs well over $50 a tankful.
Crude Oil
The closely watched NYMEX WTI Crude oil futures contract for June delivery added $1.37 to settle at $85.06 a barrel on Friday.
Supply and Demand - The Energy Information Administration reported Wednesday that oil inventories increases by 1.9 million barrels vs. the previous week.
While placing a small amount of downward pressure on crude oil through the end of the trading week, a report by the US Commerce department vastly overshadowed its significance. The Government report showed new home sales rose 27% in March, the largest jump in 47 years. This large percentage increase however comes from a comparison to New Home sales in February that had hit record 47 year lows.
While a positive sign for the economy as a whole, New Home sales are still down 70% from their peak in 2005 thanks in part to the almost unconscionable, Wall Street Derivatives Profit frenzy that was in full swing at the time.
The weekly durable goods release from the Commerce department today painted a slightly different picture as orders placed with U.S. factories fell by 1.3%, down for the first time in four months.
For the week, Crude Oil rose $2.10, with the newly established trading range between $82 and $87 per barrel still intact.
Gasoline
The US average price for a gallon of regular unleaded was essentially unchanged this past week, averaging $2.86 per gallon. This is $0.80 above the price we paid at the pump a year ago.
Gulf Coast residents continue to pay the lowest average price in the nation at $2.75 per gallon, unchanged from a week ago.
West Coast residents saw their prices paid at the pump essentially unchanged at $3.06 while Californian’s saw a penny drop to $3.09 per gallon.
On the CME, Gasoline for May Delivery was up a surprisingly strong $0.0516 to settle at $2.3518 this afternoon. For the week, Gasoline was up $0.0818.
Diesel
The U.S. average price for diesel fuel remained flat this week at $3.07 per gallon, $0.84 above year ago levels according to the EIA.
Gulf Coast residents saw prices up a penny to $3.03 per gallon and by far the lowest price of any other region.
The West Coast average moved up almost two cents to $3.20 per gallon, while the average in California inched up nearly a penny to $3.23 per gallon.
On the CME, Home Heating oil, an exact substitute and proxy for Diesel settled at $2.2511, up $0.0361 for the day. For the week, Heating Oil climbed $0.0386.
Gasoline vs. Diesel wholesale vs. retail spread widens
At the pump, diesel is averaging $0.21 higher per gallon than gasoline yet is a dime less costly to take physical delivery in NY. The spread continues to grow and preferential taxing for gasoline is certainly not helping the diesel cause.
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