Ethanol Blog
Ethanol and Energy Prices Fall Sharply
Ethanol futures were extremely lightly traded Friday morning during the abbreviated trading session following Thanksgiving Day.
But the biggest news through the market came from the crude oil complex following the OPEC meeting Nov. 27. OPEC ministers decided to not cut overall production of crude oil, which led to aggressive price pressure through the crude oil complex, as well as aggressive double-digit losses in gasoline prices.
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Nearby crude oil futures tumbled $7 per barrel with front-month January futures falling $7.54 a barrel. This pushed crude oil prices to the lowest level since 2009, and creates even more uncertainty about drawing any significant support back into the complex over the near future.
RBOB gasoline prices fell sharply also with the early 2015 contract posting losses of 18 cents per gallon as traders quickly tried to account for the continued build in supplies. Even though ethanol availability is tight in the short term, the longer term outlook is weakening based on the weakness in energy prices.
Rick Kment can be reached at rick.kment@dtn.com
(ES)
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