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Despite the threats from trade wars the black swan event was coronavirus, which has upended markets and decimated supply chains. Below,...

Despite The Chaos Retail Fuels Prices To Drop



Despite the threats from trade wars the black swan event was coronavirus, which has upended markets and decimated supply chains. Below, excellent example of market dynamics. - CH

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A local gasoline wholesaler says we’re quickly going to see prices at the pump fall in central Virginia as crude prices crash due to the Russia-Saudi Arabia oil war. Palmyra resident and Virginia Fuels President John Zehler sees $1.50-a-gallon gas prices by the end of the month. With WTI crude — the oil from which U.S. gasoline is manufactured — running $32-to-$34-a-barrel, Zehler calculates it’s about 75-cents a gallon for crude. Add approximately 70-to-75-cents for transportation, refining, taxes, and margins, Zehler says we’re looking at roughly $1.50 retail. And because the prices are crashing so quickly, he says we’ll see prices at the pump fall quickly. Zehler says retailers want to run larger margins, but they’ll be pulled down initially by the big box stores… such as Sheetz, Wawa, Kroger, Costco, Walmart, etc. - WINA Virginia

Chris Robinson, managing director of agriculture and commodities at TJM in Chicago, is advising clients to take advantage of crude's plunge to lock in diesel prices. “At the end of the day, that's the silver lining to being an energy trader/farmer,” he said. - Bloomberg

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