Clipper Oil: Latest Fuel News - WTI Crude Hits Highest Level in 7 Years

Latest Fuel News

October 2021

WTI Crude Hits Highest Levels in 7 Years

WTI crude hit the psychologically important $85 per barrel mark earlier on Monday—the highest the U.S. crude benchmark has traded since October 2014.

WTI prices eased later in the afternoon, with the benchmark falling back to $84.02—still up on the day and up about 20% month on month.

The skyrocketing crude prices are largely the result of gas-to-oil switching amid a natural gas crisis in Europe and Asia. According to a note to clients from Goldman Sachs, it sees global crude oil demand could see a million barrel per day bump as the price of natural gas booms. Continue reading here (Source: OilPrice).

How Will Higher Fuel Prices Affect Different Parts of the World?

Reports of higher energy costs are causing concern around the world as pressure increases on businesses and people who buy goods and services.

The biggest shortage, the Associated Press reports, is a lack of natural gas in Europe. European countries import 90 percent of their supply. Much of it comes from Russia. European prices have increased by five times since the start of the year.

Experts blame several events for the gas shortage. They say demand increased after coronavirus restrictions were lifted. They say the past cold winter reduced reserves. And the summer was less windy than usual, so less wind energy was generated.

Continue reading here (Source: VOA News).

Wall Street Projects a "Higher For Longer" Era for Oil Prices

Could the era of cheap oil supply be gone for good? That’s the conclusion of some of the biggest commodities desks on Wall Street, where banks have been lifting their long-term price forecasts, often by $10 or more.

While the U.S. shale boom brought about a “lower-for-longer” mantra, the market is now fixated on climate change and the dwindling appetite to invest in fossil fuels. Instead of growing supply, companies are under pressure to limit their spending, causing a structural under-investment in new production that -- the argument goes -- will keep oil prices higher for longer.

“My advice to clients is that you want to stay long oil until you know where that equilibrium price is” that brings new supplies online, said Jeff Currie, head of commodities research at Goldman Sachs Group Inc. “We know it’s above these levels because we haven’t had a big uptick in capex and investment.” Continue reading here (Source: World Oil).

EIA Forecasts US Winter Natural Gas Bills Will Be 30% Higher Than Last Winter

In our latest Winter Fuels Outlook, we forecast that U.S. households that primarily use natural gas for space heating will spend an average of $746 on heating this winter (October–March), which is $172, or 30%, more than last year.

Natural gas is the primary heating fuel for 48% of U.S. homes, according to the U.S. Census Bureau’s 2019 American Community Survey. Residential spending on winter natural gas bills is largely determined by the retail price of natural gas and the amount of natural gas consumed.

Higher retail natural gas prices are the primary driver for the expected increase in natural gas heating expenditures this winter. On average, retail natural gas prices in the United States are expected to rise from $10.17 per thousand cubic feet (Mcf) last winter to $12.93/Mcf this winter, the highest price since the 2005–06 winter average. We expect the largest increase in retail natural gas prices to occur in the Midwest, where prices rise to $11.28/Mcf, a 45% increase compared with last winter. Continue reading here (Source: US Energy Information Administration).

US Natural Gas Prices Soar 10% As Cold Winter Forecasts Develop

Natural gas futures soared as forecasts for chilly November weather in the U.S. East heightened concern that supplies will struggle to meet demand this winter.

Henry Hub gas for November delivery gained as much as 10.7%, the biggest gain in almost three weeks, to $5.844 per million British thermal units. Prices are bouncing back from recent declines, though they’re still shy of the seven-year high reached earlier this month.

While mild October weather allowed producers to inject more gas into storage than usual, forecasts for a cooler early November in the Midwest and East are a reminder that supplies of the heating and power-generation fuel are still below normal. Meanwhile, the U.S. is expected to export every molecule it can to help ease shortages of gas in Europe and Asia. Continue reading here (Source: World Oil).

Study Calculates EVs Have Higher 'Real World Refueling Cost' Than Gas Vehicles

The latest "Electric vehicles are scary!" study is out, and this one is a doozy. A new paper from the economic consulting firm Anderson Economic Group (AEG) does some novel things as it tries to comprehend the full spectrum of costs associated with making the shift away from a gas-powered vehicle to an EV. The trouble is that the authors can't hide their biases in their quest to tell everyone that gas vehicles can refuel in less time than it takes to charge an EV.

For example, based on gas prices in Michigan, where AEG is based, the study says the "direct monetary cost to drive 100 miles in an internal-combustion (ICE) vehicle is between $8 and $12, and in an EV is between $12 and $15." That sounds alarming, and the results show that no matter what, it costs more to refuel using electricity than gasoline. Continue reading here (Source: Car and Driver).