Welcome to The Distillate! Petroleum industry news for informed decisions for Tuesday August 6th, 2024. A product of Standard Petroleum Logistics (an actual fuel distributor). The full post, including Crystal Ball’s predictions for future prices is available to paid subscribers only. Want to know where the market is going? What prices are doing and why? Buy smarter, prevent runouts and save money? You can do that, with a subscription to The Distillate.
Markets are shifting with gas in the red as Debby gets downgraded. Diesel markets (which include heating oil and jet fuel) are largely flat.
Emergency declarations everywhere. The EPA issued a somewhat rare exemption of certain fuel standards for IL, IN, MI and WI as the critical ExxonMobil refinery in Joliet is not yet back to normal. Governors of Florida, Georgia, South Carolina, North Carolina and Iowa all have active emergency declarations in effect due to severe weather. These declarations generally waive the hours-of-service restrictions for trucking of goods and services related to restoration. The waivers can be found in the links.
Chevron to exit California. Congratulations Governor Newsome! Your hostile regulatory environment of California has another victim and this time, it will hit your state directly in the wallet. Chevron, the number two largest oil company in the U.S. is taking itself, some 2,000 employees and its $196.91 billion dollars in revenue to Texas. According to a 2022 report, Chevron paid over $521 million in state and local taxes. California has been home to Chevron for over 140 years and the company still owns several oil fields and two refineries in the state, which will retain most of their local employees.
A market divided. Oil markets have been strangely stable over the last week as forces diametrically opposed apply pressure. Fear of all-out-war in the Middle East and weak demand from the world’s biggest consumers (China and the U.S.) are in the driver’s seat, going in opposite directions. A looming strike of dock workers in peak hurricane season could impact fuels if waters get congested, but consumer pullback in spending (and travel) balances the scales.
Natural gas market slump.
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