Posted: November 9th, 2015 | Author: | Filed under: Best practices, Economic Barometer, Economic Indicators, Energy, Energy, Houston Natural Gas Storage, Natural Gas, Negotiating with Suppliers, Uncategorized, US Dollar, USA, What's Happening in Our Profession | Tags: , , , , , , , , | No Comments »

NEGOTIATOR’S TAKE: Record storage means Natural Gas prices likely to remain low for the foreseeable future.

Set to beat 2012 record

The U.S. has tied and is set to surpass a record for the amount of natural gas in storage, according to the latest Energy Department data.

Inventory figures released early this month show 3.929 trillion cubic feet in storage across the country, tying the previous weekly record of 3.929 trillion cubic feet set on Nov. 2, 2012.  And with two or three weeks of additional inventory gains expected this year, it’s likely the U.S. will have a new high mark by the time the summer and fall injection season ends.

The large amount of gas in storage, continued strong gas production and forecasts for a warm winter — which would mean less need for natural gas as a heating fuel — have weighed on prices.  Natural gas fell close to $2 per million British thermal unit at the end of October, a three-year low.

Traditionally, U.S. inventories rise during the warm summer months and then fall as cold weather arrives and natural gas is used for heating.  A colder-than-expected winter could lead to higher prices, but it would take a prolonged cold snap to burn through the extra cushion provided by the record amount of storage and force prices up significantly.

In total, the U.S. Energy Information Administration estimated that about 2.453 trillion cubic feet of natural gas has gone into storage since April, the second largest amount behind only the 2014 injection season.  This winter, the EIA is forecasting the winter inventory draws will be less than the five-year average at about 2 trillion cubic feet.

That would leave about 1.9 trillion cubic feet of gas in storage when the weather warms in 2016, plenty to weigh prices down into next year as well.  The EIA forecasts that natural gas prices will remain below $3 per million British thermal unit through mid-2016.


Weekly gas storage graph. NOV 2015

SOURCE: Fuel Fix []

AUTHOR: Robert Grattan, Energy Reporter at and the Houston Chronicle – view his LinkedIn profile, HERE

The U.S. Natural Gas Story in 15 Charts

Posted: September 21st, 2015 | Author: | Filed under: Energy, Gem, Natural Gas | Tags: , , , , | No Comments »

Natural gasThe story of U.S. natural gas gets referenced a lot but you may not know whats going on. Here are 15 charts that tell the story of the U.S. natural gas market which has been completely changed by the rise of horizontal drilling and hydraulic fracturing.

In the past few years, new technologies and cheaper costs allowed producers to access gas trapped in parts of the U.S. previously considered unreachable.

Read the rest of The U.S. Natural Gas Story in 15 Charts » » »


Posted: September 9th, 2015 | Author: | Filed under: China, Commodities, Copper, Crude Oil, Economic Indicators, Energy, Japan, Negotiating with Suppliers, Oil, Rubber, Thailand, Uncategorized, USA, Wall Street Journal, West Texas Intermediate, What's Happening in Our Profession, Yen | Tags: , , , , , , , , , , , , , , | No Comments »

NEGOTIATOR’S TAKE:  Rubber prices are at 6-year lows – a good time to approach suppliers for price decreases.


Rubber has emerged as one of the worst performers amid the slump in global commodities in recent weeks, thanks to a continuing glut of the material used in products from tires to condoms.


Benchmark futures in Tokyo are near their lowest level in six years

While copper is down 15% in the last three months and West Texas Intermediate crude oil has slumped 23%, benchmark rubber futures traded in Tokyo have sunk 27% to ¥167.80 a kilogram, around their lowest level for six years.

Soft rubber graph


Rubber’s lack of bounce highlights how, as demand growth slows in key markets, the most vulnerable commodities are those whose producers have been unable to tame output over recent years . . . . read the rest of this ProPurchaser sourced article, HERE.


Source: The Wall Street Journal, September 2015

Article Author: LUCY CRAMER – View her biography, HERE.


Posted: August 20th, 2015 | Author: | Filed under: Commodities, Crude Oil, Energy, Energy, Iran, Negotiating with Suppliers, Oil, Uncategorized, USA, Wall Street Journal | Tags: , , , , , , , , | No Comments »

NEGOTIATOR’S TAKE: Lubricants, plastics and transportation are all candidates for price reduction.


Seasonal slowdown of oil graph


Toward prices not seen since the last financial crisis

As U.S. oil fell to a six-year low below $41 a barrel on Wednesday, an increasing number of analysts and traders are saying crude could drop into the $30s—and soon.

The move to a price last seen at the height of the financial crisis, in February 2009, could come amid a seasonal falloff in demand, coupled with concerns about the Chinese economy and the continuing global glut of crude. Cheaper oil would bring further joy to consumers and businesses around the globe, but more pain for everyone from Russian budget officials to U.S. shale-oil drillers….read the rest of this ProPurchaser sourced article, HERE.


Source: The Wall Street Journal, August 2015

Article Author: GEORGI KANTCHEV  (view his biography, HERE)

Shale gas blasts open world energy market

Posted: July 28th, 2015 | Author: | Filed under: Energy, Gem, Natural Gas | Tags: , , , , , | No Comments »

Shale gas drillingUnconventional treasure: Shale gas is trapped deep inside rock formations.

Shale gas is a new and abundant source of natural gas, trapped in rock formations. Oil companies have known about it for decades but always dismissed it because it was too expensive and difficult to extract.

In the past few years new technologies that pump water underground to fracture the rock and free the gas have been perfected. The breakthrough has opened a new frontier for the energy industry and turned long-held assumptions about the world’s dwindling supplies on their head.
via Shale gas blasts open world energy market on Propurchaser


Posted: July 20th, 2015 | Author: | Filed under: Australia, Commodities, Energy, Energy, ethylene, Natural Gas, Plastics, Saudi Arabia, Shale gas, USA, What's Happening in Our Profession | Tags: , , , , , , , | No Comments »

NEGOTIATOR’S TAKE:  North American producers have a huge cost advantage for plastic products made from Ethylene.  You might want to re-think sourcing from China.

Now that the US has surpassed Saudi Arabia as the top crude oil and natural gas producer, it can produce cheaper plastic and bring better economic prospects to the nation.  How so?  Well, it’s ethane that’s the key ingredient:




Ethane can be derived from both natural gas and crude oil.  From ethane you get ethylene, which is the basic building block of many plastics….read the rest of this ProPurchaser sourced article, here.

Source: Spend Matters

Article Author: RAJIV JOARDER of Mintec – View his profile at: LinkedIn

WTI at $45: have we reached the bottom yet?

Posted: January 27th, 2015 | Author: | Filed under: Energy, Oil, Russia, Saudi Arabia, USA | Tags: , , , | No Comments »

WTI at $45: have we reached the bottom yet?West Texas Intermediate for March delivery decreased as much as $1.24 to $44.35 a barrel in electronic trading on the New York Mercantile Exchange and was down 57 cents to $45.02 at 12:14 p.m. London time. The contract lost 72 cents to $45.59 on Jan. 23, the lowest close since March 2009. The volume of all futures traded was 24 percent above the 100-day average for the time of day.

Brent for March settlement slid as much as $1.22, or 2.5 percent, to $47.57 a barrel on the London-based ICE Futures Europe exchange. It gained 27 cents to $48.79 on Jan. 23. The European benchmark crude traded at a premium of $3.14 to WTI.

Read the rest of WTI at $45: have we reached the bottom yet? » » »

Oil rout impacts the Canadian economy

Posted: January 22nd, 2015 | Author: | Filed under: Canada, Energy, Oil | Tags: , , | No Comments »

Oil rout impacts CanadaA new Conference Board of Canada report released today at the Oil and Gas Summit 2015 in Calgary estimates Canada’s economy will suffer a 0.4 per cent hit to growth this year. Lower oil prices will have sharply differing effects across Canada’s regions and industries.

The Canadian dollar fell to its weakest in five years Tuesday on speculation the more than 50% drop in oil prices since June would lead to sharp economic revisions by the central bank.

In a shock move, the Bank of Canada cut its benchmark interest rate on Wednesday to counter the effects of cheaper oil on economic growth and inflation and help guard against the risks of a housing market downturn.

Read the rest of Oil rout impacts the Canadian economy » » »

US January propylene contracts at lowest level since November 2009

Posted: January 15th, 2015 | Author: | Filed under: Energy, propylene | Tags: , , | No Comments »

US January propylene contracts at lowest level since November 2009In spot markets Tuesday, January and February polymer-grade propylene (PGP) were heard offered at 47.5 cents/lb Mont Belvieu pipeline basis. February was heard traded Monday at 46.25 cents/lb MtB-pipe. Spot PGP was last heard traded at that level in late November 2009.

The drop comes after one US producer nominated its January contracts for an 8 cent/lb fall, tracking declining spot prices for PGP and feedstock refinery-grade propylene (RGP).

Overall, most downward pressure has been coming from global energy markets, which have lowered cracker feedslate costs and allowed overseas derivative producers to be more competitive with US product.


US december ethylene at 53-month low

Posted: January 9th, 2015 | Author: | Filed under: Commodities, Energy, ethylene, USA | Tags: , , | No Comments »

US december ethylene at 53-month lowUS December ethylene contracts settled at a 53-month low, as per sources in ICIS. Sources confirmed the December settlement at 38.25 cents/lb ($843/tonne), down by 7.25 cents/lb from 45.50 cents/lb for November. The drop puts contracts at their lowest since settling at 37 cents/lb for the month of July 2010.

The drop in spot prices was largely fueled by declining global energy markets, which made overseas derivatives more competitive and forced US sellers to lower prices. This led to less demand for ethylene, which pushed the market longer, especially as several cracker restarts in the fourth quarter boosted supply.

Via US Dec ethylene falls 7.25 cents/lb, settles at 53-month low – ICIS

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