Weekend Summary

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Gas Shortage Shifts from Texas to Florida

“We were long-hauling from Florida to Houston last week, and now we’re talking about going from Houston to Florida,” said Andy Milton, senior vice president of supply for Mansfield Oil in Gainesville, Georgia.

Oil Is Unlikely to Return to $80

Oil prices are affected by so many different factors that supply/demand is hardly enough to explain prices. While oversupply and low demand certainly do play a large role in influencing prices, other factors such as monetary policy, fuel storage capacity, and financial markets.

Plastics Will Prop Up Oil Markets

While the normal outlet for crude oil is thought to be transportation, some are looking to other uses as a key driver of crude demand. The petrochemical industry, which turns oil into things like plastics, is expected to be a key driver of demand over the next twenty years. Despite the growth, some countries are trying to ban, or significantly reduce, plastic waste and promote recycling, which could impact crude producers.

Saudi, UAE Agree Extension of Oil Cuts May Be Considered

Saudis and the United Arab Emirates have both indicated they would be in favor of extending the OPEC/Non-OPEC production cuts beyond March 2018. The UAE has already said they would be cutting customer allocations by 10% in September and October.