Weekly Insights - June 8, 2018

Good afternoon to all. I’ll jump right into the energy markets. The markets had been in somewhat of a bearish trend, but it was short lived. The DOE inventory report came out with builds across the board. This was unexpected and is blamed mostly on increased crude imports and lower corresponding exports. This resulted in refinery runs in the 94% range and making more diesel and gas. This drove the markets up about .04 on Thursday. I would not expect the inventory numbers to stay this way for long. The tankers that offloaded in the US this week are going to be looking for something to haul for the return trip. Another issue seems to be international crude supply. Particularly in reference to Venezuela. This affected Brent crude which in turn jumped the price of WTI and refined products. Fundamentals are still not having much of an effect on the markets. My opinion is that it may change after the June 22nd meeting of OPEC and Russia.

Also of note this week is propane. Inventory builds were up 4 mmb with 2mm in the Midwest. Some comments have indicated that this may be the biggest weekly build this season due to the fact that LP is in a lull as far as usage is concerned. Unfortunately, this did not drop the far out months contract price as much as would be expected. The unfortunate truth is LP will be higher priced this year than last. FCA will have summer fill, budget, and contract prices in place by the middle of next week.  We will be starting our summer fill program July 1st.  

Also, as mentioned last week, Mike and Breon will be contacting customers in need of regulator and leak check updates to do this work. Once again - it is for the safety of you and your family. Safety is our #1 priority at FCA, be it yours and ours.
Have a good week and thanks for your patronage.

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