Friday, June 1, 2018

Farmward Energy

Weekly Update

is communication may contain con dential and/or proprietary information and is intended only for the use of the individual or entity to which it is addressed. If the reader of this communication is not the intended recipient, you are hereby noti ed that any unauthorized dissemination, distribution, and/or use of this communication is strictly prohibited. e information contained herein is accurate to the best of our knowledge and belief. is report and any views expressed herein are provided for information purposes only and should not be construed in any way as an inducement to buy or sell. Farmward Cooperative does not ac-cept any liability for any loss or damage howsoever caused to anyone trading in reliance upon such information. Any prices indicated are subject to change with market conditions.

This Week’s Market News Russian Crude Oil: Moscow agreed to cut Russian output by 300,000 barrels per day, coming off a 30-year high of 11.247 million bpd. However, a Russian energy minister said that the country would be able to raise its oil output back to pre-cut levels within a short timeframe if needed.

Oil Demand: A Reuters poll came back indicating that oil will stay above $70 per barrel due to strong demand and the possibility of supply disruptions in Iran and Venezuela. The disruptions will weigh heavily on global inventories despite OPEC and Russia’s consideration for raising output. The survey indicated that analyst’s forecasts for Brent crude oil to be $71.68 per barrel in 2018 which is $4 higher than last month’s poll.

Saudi Arabia: Many are looking at the June 22nd meeting as the key to the outlook of crude for the coming year, however, Saudi Arabia could act prior to this. Next week, oil giant, Saudi Aramco will release its offi cial selling prices for July-loading cargoes, which could infl uence pricing for much of the exports coming from the Middle East.

API Report: Yesterday’s API estimated that crude inventories rose by 1.0 mmbbls last week. Cushing inventories are off by 0.1 mmbbls. while gas is expected to see a draw of 1.7 mmbbls. Distillates are expected to build by approx. 1.5 mmbbls.

Market Opinion: The energy complex is reeling back a little as the day starts on fears of crude oil output restrictions loosening up despite the OPEC meeting in June. Today’s focus will be the DOE inventory report, following a bearish API report. Reach out to your account manager to discuss any contracting options.

Heating Oil (Daily): The fi rst half of 2018 has seen a bullish trend as the low in January (1.8061) has given way to the recent high (2.3069), an increase of nearly 50 cents or 28%. Since the recent high, geo-political news on global supply/output has pushed values lower. Currently heating oil is seeing support at 2.1805, it’s next line of resistance at 2.2688. If the inventory comes up showing builds and heating oil breaks through its support level at 2.1805, its next line of support is 2.0921 which was seen earlier this month as well as in the latter half of January.

Energy Highlights

Energy markets were mixed throughout the day, however, ended with losses seen across the board over the fear of a trade war. U.S. import tariff s have been imposed on steel and aluminum from Canada, Mexico and Europe - alll three have planned to retaliate with import tariff s on U.S. goods. Today’s inventory report gave way to a surprise draw on crude on 3.6mmbls as the API report was calling for a build on 1.0mmbls. Distillates and gasoline inventories saw a build of about 0.5mmbls each. Refi nery utilization was up 2.1% at 93.9%. Most observers believe that the U.S. crude production will top 11 million barrels per day before June is over. Tomorrow brings the beginning of hurricane season adn OPIS is beginning to hear worries of low inventories after 1 already named tropical system is in the books.

Farmward Energy

Weekly Update

is communication may contain con dential and/or proprietary information and is intended only for the use of the individual or entity to which it is addressed. If the reader of this communication is not the intended recipient, you are hereby noti ed that any unauthorized dissemination, distribution, and/or use of this communication is strictly prohibited. e information contained herein is accurate to the best of our knowledge and belief. is report and any views expressed herein are provided for information purposes only and should not be construed in any way as an inducement to buy or sell. Farmward Cooperative does not ac-cept any liability for any loss or damage howsoever caused to anyone trading in reliance upon such information. Any prices indicated are subject to change with market conditions.

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Propane saw a build this week of 2.0 MMB which was greater than expect-ed. Crude was down signifi cantly on the day prior to the inventory report, but is currently creeping back to even on the day post report stating a 3.6 MMB draw. Now it’s up to propane to make its move, so far we are still down ¾ of a cent in Conway and down a cent in Belvieu.

Page 3Farmward Energy

Weekly Update

is communication may contain con dential and/or proprietary information and is intended only for the use of the individual or entity to which it is addressed. If the reader of this communication is not the intended recipient, you are hereby noti ed that any unauthorized dissemination, distribution, and/or use of this communication is strictly prohibited. e information contained herein is accurate to the best of our knowledge and belief. is report and any views expressed herein are provided for information purposes only and should not be construed in any way as an inducement to buy or sell. Farmward Cooperative does not ac-cept any liability for any loss or damage howsoever caused to anyone trading in reliance upon such information. Any prices indicated are subject to change with market conditions.

For any inquiries, please contact:Morgan Offi ce .................................. 507.249.3196 Curty Meyers .................................... 507.430.1884 cmeyers@farmward.netTravis Wendt .....................................507.227.7119 twendt@farmward.netPat Macht.......................................... 507-430.2233 pmacht@farmward.net

Price 1000 Gal 1500 Gal

Ruby FM 2.759 2.749 2.739

#2 Clear 3.239 3.229 3.219

Propane Ag/Comm 1.31

Propane Home Heat 1.41