This week we saw headlines of the Ukraine border situation intensifying, took a look at electric vehicles and if they are cleaner than traditional combustion engines, and also a look at what backwardation means and what is happening in the market right now. As the situation and tension in the East continue to build, NATO is stepping in for the first time by having their forces on standby alert. Along with troops on the ground, the alliance has sent both ships and planes to the region to strengthen the eastern defenses they have in place to try and prevent a Russian attack.
This week the Fuels Institute released a new report that outlines the life cycle carbon emissions of battery electric (BEV), internal combustion engine (ICEV), and hybrid electric vehicles (HEV). The report outlines a few critical facts: percentages of greenhouse gases emitted, total emissions generated from these vehicles, total cost comparison of operating these vehicles, and much more. If you are interested in the report, please click here to download it from Fuels Institute.
Lastly, we took a look what happens when fuel prices as reversed. Market volatility is nothing new, but the recent price rally has sent prices screeching to multi-year highs. Markets are currently showing steep backwardation, a technical trading term that means the price of fuel in the future is lower than current rates. Now, markets are showing more than a 30-cent spread between February (“prompt month”) prices and December 2022 prices. What does backwardation mean for fuel buyers?
Prices in Review
WTI Crude opened the week at $84.91. Prices increased steadily throughout the week, hitting a high on Friday. Crude opened Friday at $87.50, an increase of $2.59 from Monday.
Diesel opened the week at $2.6872. Diesel also rose steadily this week, similar to crude. It opened Friday at $2.8289, an increase of $0.1417 from Monday.
Gasoline opened the week at $2.4455. Prices were volatile throughout the week with many changes. Today prices are up with gasoline opening at $2.5608, up $0.1153 from Monday’s opening price.