Repost: Latest OPIS Alert and Comments

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[Sysop: Please delete the incorrectly formatted previous, duplicate post.]

The latest OPIS alert punctually pilfered from Downstreamer's forum, with personal comments in bracketed italics:

NYMEX GAINS PUSH SPOT NY NO. 2, DIESEL OVER 90CTS/GAL

The NYMEX No. 2 futures are off and running this morning on the heels of API/DOE data that revealed a 3.7-million and 3.9-million bbl draw on nationwide distillate stocks. The raging NYMEX is not stopping the advance of the spot differentials either with NY traders seeing premiums to the Merc moving up another penny, shooting both high and low sulfur into the mid-90's.

[It was obvious two days ago that product was flying out the pipes when it began moving around the Harbor in measures of metric tons, rather than gallons.]

At presstime, Feb. No. 2 futures were up 3.87cts to 83.9cts with the combination of cold weather and supply draws giving distillate sellers in the Harbor carte blanche to name their price.

[It's lightly snowing in the Harbor region today, but at a temperature of about 40 degrees Farenheit, so bitter cold should no longer be an excuse for profiteering and panic. There currently appears to be plenty of petro in the pipelines and on the waterfront tank farms.]

This morning, NY spot traders tell OPIS that heating oil opened the day at 9cts over the Feb. futures while low sulfur diesel was 10cts over. Jet and kero were running 28cts over and 30cts over respectively with kerosene almost impossible to locate.

[I noted 8,000 gallons of kero on a barge moving through the Harbor last night, so it is available.]

Based on the NYMEX gains heating oil is now around 93cts/gal or about 10cts/gal higher than Tuesday's closing numbers. Kero is now selling at $1.14/gal if you can find it.

[I have about 28 gallons of clear kero, and 24 gallons of Clear-Lite, if anyone's interested. Of course, I expect to make *modest* gains on the original purchase price (after all, I have to calculate cost of inventory along with current market atmosphere, yes?)] :-)

- Mark Mahoney - mmahoney@opisnet.com

If oil goes dinosaur, I'll be among the first to know.



-- Harbor Guy (HarborGuy@OnThe.Waterfront), January 20, 2000

Answers

i am sorry harbor guy but this post is just too much to bear. agreed you have a unique vantage point, but one harbor does not a whole distribution and shipping system make. i realize folks enjoy your writing but i think you are going a bit far 1) in trying to make a profit on fuel that is READILY available (one hopes you are kidding), 2) some of the assumptions you make from your "microcosm" view of the world, 3) your statement that "If oil goes dinosaur, I'll be among the first to know."

Pray tell on that third statement, what is it you actually do there in the harbor and why do you think you will know?

-- tt (cuddluppy@aol.coma), January 20, 2000.


Think I'll just go pat my tank farm on the way to work......

C

-- Chuck, a night driver (rienzoo@en.com), January 20, 2000.


HarborGuy, keep it coming. We're supposed to sucking the excess inventory out of Europe right now, so you may be seeing that moving in a week or so.

BTW, having the tank farm sure is comforting. Problem is the keeping it all camo'ed!

-- Redeye in Ohio (cannot@work.com), January 20, 2000.


Harbor Guy--so much for your assessment of plenty of kerosene.

2000-01-20 14:30:44 EST ***NORTHEASTERN SUPPLY SITUATION GROWS MORE DESPERATE; SPIKE CONTINUES Buyers of heating oil and kerosene are desperately looking for product that can replenish downstream supplies, and prices are soaring to numbers which are 30-40cts gal above where they were when Year 2000 began. NYMEX energy futures only tell a small portion of the story. They were up 4.37cts gal to 84.40cts gal at midafternoon, but that increase was a mere fraction of the gains seen in the physical cash market. Kerosene is in desperate supply, with terminals such as Portland Maine totally out of the fuel, which still is the fuel of choice for much of that state. Spot kerosene is quoted at 34cts gal over the NYMEX, this afternoon, putting the theoretical price at nearly $1.20 gal. Jet fuel is just a few cents behind this number and bbls are tough to find. Heating oil has swelled to premiums over the NYMEX that haven't been seen since December 1989. At 2:30 P.M. EST, prompt heating oil was worth 16ts gal over the NYMEX or $1.00 gal. Diesel fuel is trading for about 0.5cts gal less, but much of the diesel available is destined to go to the heating fuel market where it is desperately needed over the next week or ten days. Prices are sharply higher at the Gulf Coast, but only because the NYMEX has raced higher. Diesel is on offer at 1.75cts gal off the NYMEX or about 82.75cts gal and jet fuel is quoted at nearly 9cts gal over the screen or about 93cts gal. - Tom Kloza, tkloza@opisnet.com

-- no one (pridebefore@afall.com), January 20, 2000.


Harbor Guy,

I appreciate the posts.

But 8,000 gallons of kero is nothing. Its prob already committed. When they say none is available, they don't mean there isn't any physical product, they just mean there isn't any for sale.

-- Downstreamer (downstream@bigfoot.com), January 20, 2000.



Harbor Guy,

You do good work, please keep the comments coming. I do agree with Downstreamer though that most likely what your seeing is already sold or committed if it's going out...if it's incoming it probably isn't yet counted to inventory, maybe? I am not that sure.

Downstreamer,

Thanks for you input on that. Do I understand correctly that a barge of fuel coming in might not yet be committed? Or do you figure that given current atmosphere that most incoming is already committed before it hits the official inventory? I'm just not sure on the specifics of how that stuff gets qualified.

-- RC (racambab@mailcity.com), January 20, 2000.


Thanks all for the good comments. I've been watching kero move on barges through the Harbor since I started the Shipping News posts (that's since about January 3), but petro did not have my great attention at the time. If total supply of kero is tight, I'm surprised. Yes, Downstreamer, 8,000 gallons is a small amount (compared with, say, a load of 105,000 gallons), but it may have been part of a larger load parceled out to various waterfront points.

RC, I believe most of what I see moving is already purchased and en route for delivery. Most of what I see is outgoing from the waterfront facilities. Beyond that I can't offer details.

tt, I surely was jesting about the kero sale, that's why a smiley face was placed at the end of the sentence. As far as knowing (a little exaggerated), I'll know before it gets wide reportage, simply because I'm On The Waterfront.

It is my *opinion* at this time that the latest Harbor action re prices is due primarily to event-driven hoarding (panic -- cold + OPEC output extension + percentage refinery breakdowns) and opportunistic profiteering.

My advice to buyers is to gather together en masse; when the sellers in the Harbor tell you the inflated price, "It's X dollars per gallon (or barrel) today, say "Eat it." If all the buyers do this, after 72 hours the stuff will be overflowing the rims of the tanks in the farms, pipelines will be backing up, the tankers will be packing the anchorages, and the sellers will be begging you to take the juice off their hands below cost, and prices will stabilize.

"Eat it."



-- Harbor Guy (HarborGuy@OnThe.Waterfront), January 20, 2000.

tt: P.S., If I still am unclear, I do have the kero, but the offering for gouging is a jest -- that's my meaning.



-- Harbor Guy (HarborGuy@OnThe.Waterfront), January 20, 2000.

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