On 12/20 RBOB settled at its highest value in 20 days. With Midwest basis up an additional $0.13 in five days retail margins are getting severely squeezed. With the market trending slightly higher today time is running out for a pullback before the holiday weekend.
Gasoline demand falls off significantly after the holidays which could lead to some downside price correction, however the market will soon be looking at spring and the onset of much pricier lower RVP products.
Diesel Fuel is having a strong price run this week as well. Transportation Fuel demand prior to the holidays is excellent and heating demand is playing its seasonal role. Heating degree days are up over the last three years. Today is the first day of winter and much colder weather is coming to the Midwest, Mid Atlantic and North East next week.
Beware of holiday trading weeks. The market is thinly traded and we’ve seen significant volatility over the years. Mostly to the upside.
Do you want to know what you’re going to pay for the next several days? Do you want to lock in your retail margin? Are you concerned about heating oil prices moving higher next week when the weather arrives? Talk to us about a short term fixed rack price. There is value in knowing what you’re going to pay.
