Stillwater Economics

IMO 2020: Current Futures Prices and Refiner Processing Options

June 26, 2019 ,

June 27, 2019 By Ralph Grimmer IMO 2020 implementation is six months away, and shipowners will likely start purchasing IMO 2020-compliant marine fuel (for vessels without onboard scrubbers) in the next three months. Stillwater Associates has offered a series of articles on various aspects of IMO 2020 over the past two years. In this month’s article, we provide an update...
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California Gasoline Prices – Part 2

June 26, 2019 ,

June 26, 2019 By Dave Hackett Last month, I wrote about spot California gasoline prices and promised to write about California retail gasoline prices this month. As explained by my Petroleum Market Advisory Committee (PMAC) colleague, Professor Severin Borenstein, the retail gasoline prices in this state are higher than the U.S. average, even after deducting California’s high taxes and fees....
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Knee-High by the Fourth of July?

June 22, 2019

June 22, 2019 By Adam Schubert Rising gasoline prices are making headlines, and though there are many forces at work, one of those contributing factors isn’t receiving the same buzz as others. Corn farmers are facing incredible challenges this year, creating upward pressure on ethanol prices which in-turn increase the prices of the final, blended gasoline. Stillwater is tracking the...
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California Gasoline Prices

May 28, 2019 ,

May 28, 2019 By Dave Hackett Stillwater has been writing about California gasoline prices for a long time. Because gasoline prices on the West Coast, and in California in particular, tend to be volatile toward the upside, this issue always gets the attention of consumers and politicians. Our first engagement to look at this subject came from the California Energy...
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Breaking down California’s gasoline price spike

April 17, 2019 ,

April 17, 2019 By Kendra Seymour California’s gasoline prices consistently outpace average pump prices across the U.S., but in the past month, Californians have experienced an average price increase of roughly 60 cents per gallon, spiking the Golden State’s fuel prices even higher than usual, as you can see in the chart from GasBuddy, below. What’s going on here? Why...
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California’s Fossil Fuel “Sin Tax”

April 16, 2019 ,

April 16, 2019 By John Faulstich With the recent increase in gasoline prices in California (the retail gas price average just bumped up over $4 per gallon) and renewed interest in this subject, we thought it timely to present an overview of the major components of what goes into the price of gasoline at the pump. The U.S. Energy Information...
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IMO 2020: How Will the Marketplace Value New Compliant Marine Fuels?

March 20, 2019 , ,

March 20, 2019 By Jim Mladenik & Ralph Grimmer Over the past two years, Stillwater Associates has offered a series of articles on various aspects of IMO 2020. Implementation of IMO 2020 is now less than ten months away. In this article, we will provide information on data sources providing visibility to spot and futures prices for IMO 2020-compliant blends...
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Stillwater Benchmark for Refinery Stationary Source Cap & Trade Costs

February 21, 2019 , ,

August 21, 2019 1.238 cpg   This benchmark represents the cost in cents per gallon of CARBOB gasoline and CARB diesel incurred by the refining sector under of the stationary source provision of California’s Cap and Trade program (Stationary Source Cap and Trade or SSC&T). Stillwater’s Benchmark for Refinery SSC&T Cost is calculated using the following formula: Actual Refining Sector...
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Webinar: IMO 2020 and the Sulphur/Sulphuric Acid Markets

January 16, 2019 , ,

Acuity Commodities has partnered with Stillwater Associates to model three scenarios reflecting implementation of new International Maritime Organization (IMO) marine fuel rule from January 1, 2020, when the maximum sulphur content in bunker fuel oil has to be reduced to 0.50%. With the IMO 2020 implementation deadline unlikely to be postponed and less than 12 months away, sulphur and acid...
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The Problem of Invalidated RINs in the Renewable Fuel Standard

November 14, 2018 ,

November 14, 2018 by Mike Newman of Parhelion Underwriting Under the Renewable Fuel Standard (RFS), the Environmental Protection Agency (EPA) imposed a “buyer beware” approach to the purchase and sale of Renewable Identification Numbers (RINs). This creates a liability for any buyer of RINs, making them responsible for purchases of invalid RINS, even if done inadvertently.[1] The liability includes the...
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Has California Gasoline Demand Peaked?

October 17, 2018 ,

by Dave Hackett Stillwater is often asked to provide forecasts for petroleum demand. Clients use these forecasts to understand how the market is likely to change. For the last four or five years, we have predicted a drop in gasoline demand, mostly driven by cars and light-duty trucks getting better gas mileage as the result of the Corporate Average Fuel...
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War Story: “Go figure it out”

October 15, 2018 , , , ,

by Brian Conroy When Stillwater Associate Brian Conroy worked for BP in 2006 as Global Sales and Market Development Manager of Specialty Chemicals, he was offered an opportunity to try something new. With a background in chemicals, beginning in research and progressing to various roles in business, he was ready for the change. BP’s CEO had mandated the launch of...
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California Stationary Source Cap and Trade Benchmark

August 8, 2018 , ,

August 8, 2018, updated February 28, 2019 BACKGROUND California’s Global Warming Solutions Act of 2006 (AB 32) put in place a series of policies and programs across all major sectors with the goal of returning California emissions to 1990 levels by 2020. The California Air Resources Board (CARB) is tasked with developing regulations and market mechanisms to meet this goal....
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Projecting the Costs of California’s Cap & Trade and Low Carbon Fuel Standard Programs

July 25, 2018 , ,

July 25, 2018 By Jim Mladenik and Kendra Seymour Showing the line-item cost to consumers of carbon-reduction programs assists legislators in crafting effective policy and helps fuel consumers make informed decisions. To that end, Stillwater’s carbon policy team recently conducted an analysis of the potential impact of California’s Low Carbon Fuel Standard (LCFS) and Carbon Cap & Trade (C&T) programs...
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Expected Pricing and Economic Impacts of the IMO 2020 Rule

July 10, 2018 , ,

July 11, 2018 by Ralph Grimmer The International Maritime Organization (IMO) will make a significant change to the maximum allowed sulfur content of marine fuel consumed on open oceans beginning January 1, 2020. This global change (via IMO revision of its MARPOL VI rule) was triggered by an IMO decision in 2008. Over the past year, Stillwater Associates has offered...
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LCFS Successes and Challenges

June 20, 2018 , ,

On June 19, 2018, Stillwater’s President, Dave Hackett, participated as a panel member in an informational hearing on the Low Carbon Fuel Standard (LCFS) held by the California State Assembly’s Select Committee on California’s Energy Future. The panel included an overview of the LCFS offered by the Legislative Analyst’s Office followed by comments from regulated parties and interested stakeholders. Dave...
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IMO 2020 & Crude Slate Pricing: Choose Your Own Adventure

June 5, 2018 , ,

June 5, 2018 by Kendra Seymour Contributors: James Ahrens, John Faulstich, Ralph Grimmer, Jim Mladenik, and Arshad Sheikh Let’s go back in time, to the late 1970s when sulfur regulations for fuel oil were less stringent and heavy San Joaquin Valley (SJV) crude was priced extremely low. This SJV was often minimally processed then dumped into the bunker fuel market...
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The Trans Mountain Tangle

May 2, 2018 , , ,

May 2, 2018 by Stillwater Staff There’s a battle brewing between two provinces in Canada over a pipeline, and it may cause transportation fuels prices to spike at least in the short-term. Here we offer the backstory to get you up-to-date. In 2013, Kinder Morgan filed an application with the Canadian National Energy Board to essentially twin the existing 1,150...
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California Carbon Info: Analysis of CCO usage for 2016 compliance obligation

February 10, 2018 , , ,

As the passage of AB 398 has strengthened and extended California’s Cap and Trade program, we think our readers will benefit from a spotlight on the trends in the carbon credit market. As such, we periodically feature guest articles on California’s Cap and Trade program from our friends at CaliforniaCarbon.info. CaliforniaCarbon.info is a comprehensive information service covering the Western Climate Initiative...
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The Cost of Premium

February 9, 2018 ,

February 9, 2018 By David Hackett Stillwater Associates is often retained to analyze markets. Currently, we have a project for the Fuels Institute to look at the demand for higher octane gasoline in the future.  This analysis is driven by the growing demand for higher octane gasolines that cars increasingly need to maximize the performance of their turbocharged engines. In...
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California Carbon Info: California Emissions Decline Faster than Cap in 2016

November 6, 2017 , , , ,

As the passage of AB 398 has strengthened and extended California’s Cap and Trade program, we think our readers will benefit from a spotlight on the trends in the carbon credit market. We will be featuring guest articles on California’s Cap and Trade program from our friends at CaliforniaCarbon.info. CaliforniaCarbon.info is a comprehensive information service covering the Western Climate Initiative...
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California Carbon Info: Analyzing California’s offset demand

September 13, 2017 , , , ,

As the passage of AB 398 has strengthened and extended California’s Cap and Trade program, we think our readers will benefit from a spotlight on the trends in the carbon credit market. Starting this month, we will be featuring guest articles on California’s Cap and Trade program from our friends at CaliforniaCarbon.info. CaliforniaCarbon.info is a comprehensive information service covering the...
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What the Frack is Happening in Colorado? A Look Inside Colorado’s Hydraulic Fracking Phenomenon

July 12, 2017 ,

July 12, 2017 By Jessica Loomis The word “fracking” is as tied to the state of Colorado these days as “skiing”, “mountains” and “snow”. Fracking is the process of drilling vertically or horizontally far below the surface to inject water, sand. and chemicals at a very high pressure into rocks that are believed to have crude oil and natural gas...
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Bubble Map Update: Drop in Oil Prices Takes the Steam out of the Mid Continent

December 10, 2015 ,

December 10, 2015   The December Bubble Map shows crude oil prices dropping overall while differentials to WTI have remained relatively stable. Prices on December 9th show WTI dropping from $46 to $37 since our last blog in October. The WTI/Brent differential has widened slightly at $3 over WTI. The Bakken discount has widened to $8 under WTI. The Western...
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