In addition to the regular ENERGY UPDATE we are going to publish

Ag-Land FS, Inc.
Energy Market Update March 4, 2015
NYMEX Prices
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April Crude Oil
April Gasoline
April Heating Oil
April Natural Gas
Crude
DOE
Change
Total
3Yr
Avg.
+10.3
444.4
363
$
$
$
$
Wk Change
51.99
1.9257
1.9013
2.769
Gasoline
5 Yr.
Avg.
356
Change
+0.046
$
$
$
$
+0.54
+.207
+.2023
-.125
Distillate Fuel
Total
3Yr
Avg.
5 Yr.
Avg.
240.1
229
231
Change
-1.722
Total
3Yr
Avg.
5 Yr.
Avg.
125.0
126
132
+6.500 to +2.200
+1.000 to -4.000
-0.000 to -3.600
Propane
Total 55.1 -4.1
Midwest 16.8 -2.5
Gulf 34.3 -0.60
API’s
Crude +2.900
Gasoline +0.530
Distillates -0.296
EST.
Libyan oil production has jumped in recent days despite fresh attacks on fields and air raid near a
terminal. Production is now running about 500,000 barrels a day.
Saudi Arabia reversed course on its pricing tactics as Saudi Aramco said it was increasing its Asian
prices for light oil delivery in April by $1.40 a barrel. In addition, they raised prices in the U.S. by
$1.00 a barrel.
Private-sector employment gains continued in February but at a slower pace than in the prior
month. The Automatic Data Processing Inc. reported that employers added 212,000 jobs last
month, below January’s revised gain to 250,000.
Recent news reports have
given a lot of attention to
rig counts coming down
because of the decline in
crude oil prices.
However, this is not the
case with oil production in
the Gulf of Mexico, as the
downturn in oil prices is
expected to have minimal
direct impact on production
in this reign. EIA projects
Gulf of Mexico production to reach 1.52 million barrels per day in 2015 and 1.61 million barrels
per day in 2016, or about 16% and 17% of total U.S. crude oil production in those two years.
The U.S. is currently the largest global
exporter of refined oil products, but Saudi
Arabia plans to be number two by 2017.
Increasing their refining capacity is part of their
overall goal to increase global petroleum market
share, and also to diversify its economy. Two
new refineries will add 800,000 barrels/day in
refining capacity this year, and a 400,000
barrel/day refinery in Jazan (completion by 2017)
will increase their capacity to more than three
million barrels/day. Most of the kingdom’s
refining capacity has been overseas, with
interests in the United States and Asia in
partnership with other oil producers. Driving the
need for refineries in the country have been an
increase in domestic demand, and a need to
provide jobs. Since the slump in crude oil prices,
the refineries will also provide another source of
income for them, as well as increase market
share. Their long term plan over the next decade
is to increase their refining capacity to eight
million barrels/day – both in their country and
abroad.
China also intends to export more refined
products this year. Currently China has refining capacity of 14 million barrels/day, but the
government controls how much may be exported.
World demand drove U.S. gasoline exports
higher during the month of December.
Monthly exports for gasoline jumped by more
than 500,000 bbl/d from November to
December when prices reached a 6 year low.
Despite the jump, demand for distillate products
continues to outpace gasoline exports by nearly
double. Tax incentives help drive distillate
demand in European countries, but their lack of
refining capacity forces them to rely on U.S.
product.