April 8

4/8 – It’s that time of year when refiners begin transitioning to more expensive, summer-grade fuel. This year’s seasonal price increases will get an extra boost as a result of U.S. sanctions against Venezuela, rising crude oil prices and Midwest flooding that has impeded the production and distribution of ethanol. Crude oil futures, which started the year at $46.54 per barrel, are now $63.08 – up 35.5% YTD. Retail gasoline prices have jumped from $2.19 per gallon in mid-Feb, to $2.69. Gasoline prices, which averaged 8.1% below a year ago in Q1, have now pulled even with 2018 price levels and could crimp U.S. consumer spending this summer. In its March Short Term Energy Outlook, the EIA said gasoline prices would average $2.50 per gallon in 2019 vs. $2.73 in 2018. The EIA is likely to raise that forecast in its April 9 report. https://www.eia.gov/outlooks/steo/