Peter Beutel Demand Quotations

OPEC hawks are still concerned that demand could drop dramatically during the second quarter. But with there being a number of threats to supplies, the cartel did not feel it made sense to cut output.

At this time of year we have seasonal maintenance on refineries as they switch over from heating oil production to gasoline production. Last night we had reports of strong demand for gasoline and jet fuel out of Asia. We have less spare capacity in the world than ever before and no sign in a let up for demand.

It now looks like the post-Katrina high will be the top for a long time. Although the supply picture is the worst it has ever been, the weakening demand picture is an even bigger worry. Demand is shifting underfoot as high prices are felt by consumers.

This week's DOE report showed a decent withdrawal in distillate stocks, with demand finally showing some teeth.

If demand is not going to fall and keep on falling, then supply moves back into the driver's seat in this market.