The home heating oil industry has a long and proud history, and Fuel Oil News has been there supporting it since 1935. It is an industry that has faced many challenges during that time. In its 77th year, Fuel Oil News is doing more than just holding
Issue link: https://read.dmtmag.com/i/43833
DA T E L INE A list of recipients for the payments can be found at: www.rurdev.usda.gov/ SupportDocuments/USDAAdvancedBiofu elProducerPaymentsSept.pdf. EIA: COST OF CRUDE IS UP, REFINERY MARGINS ARE UP, AVERAGE PRICE IS UP The annual average regular-grade gaso- line retail price, which averaged $2.78 per gallon in 2010, will increase to $3.56 per gallon in 2011, and will average $3.54 per gallon in 2012, the Energy Information Administration (EIA) predicted in its lat- est Short-Term Energy Outlook. The increase in retail prices in 2011 reflects not only the higher cost of crude oil but also changes in average U.S. refinery gasoline margin (the difference between refinery wholesale gasoline prices and the average cost of crude oil) from $0.34 per gallon in 2010, to $0.50 per gallon in 2011 and $0.43 per gallon in 2012, the EIA said. On-highway diesel fuel retail prices, which averaged $2.99 per gallon in 2010, are expected to average $3.85 per gallon in 2011 and $3.87 per gallon in 2012, accord- ing to the Outlook, released September 7. Projected U.S. refinery diesel fuel margins increase from an average of $0.38 per gal- lon in 2010 to $0.65 per gallon in 2011, then fall to an average of $0.58 per gallon in 2012, according to the EIA forecast. Commercial crude oil inventory levels ended August 2011 at an estimated 359 mil- lion barrels, the same level as last year but 29 million barrels higher than the previous 5- year average for that month. Following the completion of the release of about 31 million barrels of crude oil from the U.S. Strategic Petroleum Reserve (SPR), commercial crude oil stocks are expected to rise to 364 million barrels by the end of September 2011, 34 million barrels higher than the pre- vious 5-year average. Commercial crude oil stocks are gradually drawn down to near their 5-year averages by the end of 2012. EIA expects refined product invento- ries to remain close to their 5-year averages despite the recent SPR release. Total motor gasoline stocks at the end of August 2011 were an estimated 208 million barrels, down 13 million barrels from last year but 2 million barrels above the previous 5-year average for that month. Distillate fuel oil stocks ended August 2011 at an esti- mated 157 million barrels, down 13 million barrels from the same time last year but 7 million barrels Taco breaking ground for its new Innovation and Development Center in Cranston, RI. Company President & CEO John Hazen White, Jr. was joined by family members, political representatives, guests and employees of Taco. above the previous 5-year average. Projected total motor gasoline and distillate inventories average about 1 mil- lion barrels and 7 million barrels higher, respectively, than their previous 5-year averages at the end of 2011. The EIA said it lowered its economic growth assumptions substantially compared with last month's Outlook. The latest fore- cast assumes that U.S. real gross domestic product (GDP) grows by 1.5 percent this year and 1.9 percent next year compared with 2.4 percent and 2.6 percent, respec- tively, in the previous Outlook. World oil-consumption-weighted real GDP grows by 3.1 percent and 3.8 percent in 2011 and 2012, respectively, compared with 3.4 per- cent and 4.1 percent in the last Outlook. With weaker economic growth and lower petroleum consumption growth, EIA expects the U.S. average refiner acquisition cost of crude oil to rise from an average of $100 per barrel in 2011 to $103 per barrel in 2012, compared with an increase to $107 per barrel in 2012 in last month's Outlook. CONOCOPHILLIPS SEEKS BUYER FOR TRAINER, PA., REFINERY ConocoPhillips has announced that it is seeking a buyer for its 185,000 barrel-per- day refinery in Trainer, Pa., and associated pipelines and terminals. ConocoPhillips will immediately begin the process of idling the facility and will permanently close the plant in six months if a sales transaction is unsuccessful. "After exploring a wide range of alter- natives for the refinery, the decision to sell is based on the level of investment required to remain competitive," said Willie Chiang, senior vice president of Refining, Marketing, Transportation and Commercial. "U.S. East Coast refining has been under severe market pressure for several years. Product imports, weak- ness in motor fuel demand, and costly regulatory requirements are key factors in creating this very difficult environment. This action is consistent with our stated strategic objective to reduce our refining portfolio," added Chiang. ConocoPhillips employees and con- tractors have been notified of the idling and potential permanent closure of the facility if a sales transaction cannot be completed. ConocoPhillips will redeploy employees to other positions within the company where possible. Employees who are not redeployed will receive severance benefits and job placement services. The company expects to recognize a non-cash asset impairment of approxi- mately $300 million after tax in its third-quarter financial results. For more information, go to www. conocophillips.com. FUEL OIL NEWS (ISSN 0016-2396), Canada Publication Mail Agreement #1588621, is published monthly by Bev-Al Communications, Inc. 1030 W. Higgins Road, Suite 230, Park Ridge, Il 60068. Circulated free of charge to qualified individuals in the oil heating industry in the United States. Additional and/or personal copies are available on a paid subscription basis only. 1-year subscription rates: $28.00 USA. $40.00 Canada and Mexico via service postage. $90.00 other foreign countries via air-mail postage. Single copies: $8.00 U.S. via first-class postage. $12.00 other Canada/Mexico/Foreign via airmail postage. Payable in US currency. Periodicals postage paid at Park Ridge, IL and additional mailing offices. Copyright 2011 by Bev-Al Communications, Inc. Reproduction of any portion or portions of this publication is specifically prohibited without written consent. Postmaster: Send address changes to FUEL OIL NEWS, PO Box 4290, Port Jervis, NJ 12771. 4 OCTOBER 2011 | FUEL OIL NEWS | www.fueloilnews.com