The Saudi’s are struggling to find buyers for the extra crude supply they want to sell, a move that shocked oil prices a few weeks ago and sent the globe into a massive recession nearly overnight. The linked article says this is undermining their move to increase their market share.
Due to the demand destruction caused by the demand destruction from the coronavirus, there is naturally a significant reduction in global refinery processing. This Bloomberg item says the the oil industry is bracing for the biggest idling of wells in 35 years.
Keep that thought in the back of your mind as you are pondering propane values for the coming winter and winters; what if there becomes a significant drop off in propane production? The cure for low prices is low prices, just as the cure for high prices is high prices. Producers will be struggling mightily as the year moves on, and there is a distinct possibility (or even likelihood) that propane production will be impinged.
This article from Reuters talks about how oil producers are selling their crude ‘in the physical market at lower prices not seen since the aftermath of the Asian financial crisis of the late 1990’s.’
We realize these are overwhelming times, but one cannot take their eye off the future during low energy value times such as these. While past is not indicative of future results, the past has certainly shown that low energy price periods like the one we are in can create buying opportunities.