Farm Fuels Bulletin | EIA Fuels Bearish Sentiments

Posted on 06/12/2019 12:59 PM

 

Farm Dieselfarm diesel price chart

  • Our regional average farm diesel price fell a penny per gallon this week.
  • Nine of the twelve states in our survey registered price changes. Nebraska added 4 cents, Michigan fell 6 cents and Kansas diesel fell 15 cents on the week.
  • WTI crude oil prices were generally lower on the week as oil market watchers note pessimism regarding near-term world economic growth and respond to the implications for world demand.
  • Heating oil futures are lower as well since the mid-May highs, but right at steady on the week as of this writing, Wednesday, June 12.
  • The Energy Information Administration released its June Short-term Energy Outlook this week. The big takeaway is EIA's forecast for U.S. crude oil production to continue to increase through 2020, reaching a projected average of 13.0 million barrels per day in that year. That will add to longer-term bearish sentiments if realized.propane price chart
  • Also according to EIA, national distillate stocks fell 1 million barrels in the week ended June 7, 2019 but remain 13.7 million barrels above the same week last year.

Propane

  • Propane was unchanged on the week amid scant state-to-state price moves.
  • Nebraska and Kansas firmed slightly. Iowa fell 4 cents per gallon and Minnesota and Missouri were each off a penny on the week.
  • According to EIA, national propane stocks firmed 2.862 million barrels, now 20.289 million barrels above the same week last year.

Fuel
5/28/19
6/3/19
Week-over Change
Current Week
Fuel
Farm Diesel
$2.58
$2.53
-1 cent
$2.52
Farm Diesel
LP
$1.36
$1.32
Unchanged
$1.32
LP

Our farm diesel/heating oil futures spread compares the weekly average retail farm diesel price with front-month heating oil futures as of the close on the previous Friday. A move below the "line in the sand" indicates pending upside risk. A move above our "line in the sand" indicates downside potential.

This week, our spread analysis indicates ongoing downside potential for retail farm diesel.


heating oil farm diesel spread chart

 

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