Ahh... October

 Ahh… October. Leaves are changing, Yankees in the ALDS, $6 fuel at the gas pumps… What used to be a calm transition month in the Northeast has turned into one of trepidation. With the heating season on the horizon, heating oil dealers and end users are already starting to feel the pain of what could be a very long winter.

As we mentioned weeks ago, steep backwardation in the diesel market along with high prices and carrying costs, will limit excess gallons from being in tank for some. After really thinking about it, most now agree an export ban is not the right course to take. Logistically, it would likely only help a portion of the mid-south. For example, the Northeast, where a fair amount of finished product is Canadian born, we would likely lose those gallons to European customers willing to pay more. Thus causing higher prices and lower inventory. The real solution will have to be diplomacy. An agreement with Iran, which is stuck on a zero nuke stance and a Russian realization that they will likely not annex the Donbas region. Both of which I have about as much confidence happening as I do the Yankees getting past the Rays. These are the times that it is important you have a supplier, not a marketer in your corner. One with multiple supply points, the assets to get you fuel, and your best interest in mind.