CRUDE as the standard petroleum product that moves and drives the oil industry at large, has lingered near record lows for several months now. Trading today at $38.28/bbl up from its low of $26.21/bbl in early February 2016. Duncan Oil Traders expect crude prices to decrease to the low $30’s/bbl though mid-summer this year and then climb back to the mid $40’s by December 2016. Crude Inventories are high, and until they begin to drop, the market will continue to be viewed as over supplied. 2017 will bring prices in the 40-50 range, with the possibility of OPEC instability causing spikes into the $60/bbl area. US producers will continue to look for higher stable crude prices before they start pumping crude again. Most fracking producers need $45/bbl crude to break even. Look for opportunities mid-summer to hedge 2 years out and take advantage of low Crude futures.

DIESEL which is often married to the price of crude quite closely will follow a similar track. Duncan Oil is expecting prices to remain level over the next few months, with the exception of refinery maintenance season causing short term price bubbles in regional markets. Those looking to lock in diesel prices in the fall and winter could do so now at reasonable competitive rates, or play the oil lottery and wait until the next window of opportunity which may be mid-summer (after refinery season and before harvest) to lock in winter diesel rates – should a competitive window open.

PROPANE exports and US demand is continuing to increase year after year which will cause propane supply to tighten. With increased exports, and decreased production, and higher inventories coming out of a warm winter, prices are set up to rise. Traders are predicting up to a 100% price increase in propane price between March 2016 and February 2017. As propane becomes more and more tied to crude, expect both to continue rising steadily through 2018.