www.fueloilnews.com | FUEL OIL NEWS | FEBRUARY 2016 17
2015. Weakness in global economic
growth contributed to the overall
decline in commodity markets in
2015, but unique supply-side factors
within certain commodity markets
also affected prices.
Each of the 16 commodities
in the S&P GSCI Energy, Grains,
Industrial Metals, and Precious
Metals indices declined in 2015,
with prices of some of the energy
commodities falling more than
30%. Nickel, diesel, and crude
oil had the largest price declines
among the 16 commodities in the
four S&P GSCI indices, while lead,
corn, precious metals, and gaso-
line had relatively smaller price
declines. Each commodity in the
S&P GSCI is reweighted each year
based on the commodity's world
production and trading volume to
measure its relative importance in
the global economy.
Energy. West Texas Intermediate
(WTI) and Brent, two of the major
crude oil benchmarks, account
for about 69% of the weighting in
the S&P GSCI Energy index. As a
result, the energy index tends to
follow major price movements in
the crude oil market. With sus-
tained, high crude oil production
from countries like Saudi Arabia,
Iraq, the United States, and Russia,
global liquid fuel inventories rose
significantly in 2015, resulting in
crude oil prices falling to 11-year
lows in December.
Petroleum-based products such
as reformulated gasoline blendstock
for oxygenate blending (RBOB),
ultra-low sulfur diesel (ULSD), and
gasoil together comprise 27% of the
S&P GSCI Energy index. RBOB not
only had the lowest price decline of
all energy commodities, but it also
declined less than many nonenergy
commodities because of increased
gasoline consumption in the United
States and in other countries. In
contrast, gasoil and ULSD had the
largest price declines of the energy
commodities as a result of rising
U.S. and global distillate inventories
along with lower economic growth
in emerging markets.
Natural gas accounts for the
remaining 4% of the S&P GSCI
Energy index, and in 2015, natural
gas futures prices declined to the low-
est level in 16 years in mid-December
because of increased production and
record-high inventory levels.
