Has the energy door slammed shut on 2021? Is it half open for 2022? No one seems to know. No one seems to want to know.
That’s because the price driver (supply and demand), has driven us the wrong way down a one-way street.
The short-term prices for crude and all refined products as we approach the never say never land of 2022, are now the wishful pixie dust musings of politicians stuck in their own fog patches of thought. The future is hazy because energy prices are not in their absolute control. As we enter year two of the pandemic, the lead actor has changed yet again under the name, the Omicron variant.
But the play’s plot remains the same.
No amount of regulation, legislation, left-wing environmental activation, or right-wing deactivation appears to be able to slow its march.
Prices at the pump and at the loading rack are following the day-to-day bulletins on the case numbers. Weekly U.S. inventory reports, traditionally the basis of global refined product futures prices, are now found in the back pages of the business section of our papers, just behind the obituaries.
If the pandemic is not enough, enter the politicians.
We have the madman across the water, ‘Vlad the Glad Putin,’ squeezing natural gas supply to Europe, which is jacking up prices that will eventually jump distillate crude prices in the U.S. and Canada.
All of this when demand for distillates like heating oil are increasing by the nature of winter, not by Russian ransom demands. Gasoline demand is also increasing as consumers hit the malls. Anywhere but the airports since the Omicron variant has almost shut down international travel.
South of the border we have President Joe Biden fretting over his party’s future, as the midterms may come to terms with his future.
That means America first. Everyone else (including Canada) will be lucky if they’re second.
In this country we have it a bit different as our latest version of the Minster of the Environment, the fourth one in six years, has declared war on plastic straws.
Beat that Mr. Biden!
There is only one “i” in America, and Biden knows it.
There is only one “can” in Canada. I hope our prime minister understands and supports it.
– Roger McKnight – B.Sc., Senior Petroleum Analyst