In it’s May 14 report, the International Energy Agency says that global crude runs remain depressed. OPEC are aware, and adjusted their production accordingly on May 28.
For those who think that fuel prices are coming down, OPEC is ahead of you and will make sure production falls below the drop in demand. Cartels can do that.
Off-shore drilling activity has not abated, credit crisis or not. Rates for deepwater drilling equipment are holding steady.
Here are the US charts for gasoline demand, crude oil supply in storage, and regular gasoline prices:
The electric utility industry has flexibility in its use of fuel, and oil represents a diminishing amount of the industry’s fuel, as reported long ago by DOE.
Some in the US electric utility industry are worried about their own demand destruction. With California-based businesses imploding because of overtaxation and over-regulation, San Diego’s Pacific Gas and Electric is revisiting an old new-market, electric vehicle charging. When was the last time a regulated US electric utility needed to go out and find customers? With a bit of cross-marketing, they may succeed.
Photo of Tennessee Valley Authority DC generator, 1942