Slide 16 of 25
Notes:
- Production will also impact stocks this winter.
- Last winter, production was cut back in December, which, when combined with the strong increase in demand, resulted in the large strong stock draw. But this did not diminish the typical production decline that occurred in January, leaving stocks precariously low.
- As December began, margins were low, and November weather had been 16% warmer than the prior year.
- Stocks were in the normal range, and companies were still smarting from the extremely low margins of the prior winter.
- Refiners reduced production to the prior year’s levels as a result.
- When the cold spell hit the Northeast and caused prices to spike at the end of January, production rebounded in response. However, increased imports were the main source in supply increases following the price spike.
