“Don’t do something permanently stupid because you’re temporarily upset“
Weekly Jobless Down Marginally Week over Week
- Initial jobless claims came in at 411,000 last week — lower than the upwardly revised 418,000 the previous week. It is the second-straight week that initial claims are back up over 400,000.
- Continuing claims, which are reported a week in arrears from initial claims, reached a new post-COVID low of 3.39 million. This is a notable decline from the slightly upwardly revised 3.53 million reported the previous week. Unlike new claims, continuing jobless claims have come down more profoundly over the past 12 weeks or so.
Stocks mostly up Friday of last week and up week over week
Stocks set fresh record highs on Friday, with traders hoping that a bipartisan infrastructure deal would help further stoke economic activity. The Dow closed higher on Friday of last week, up 237.02 (+0.69%) points closing out the week at 34,433.84, +1,143.76 points week over week. The S&P 500 closed higher on Friday of last week, up 14.21 points (+.33%) and closing out the week at 4,280.70, up +114.25 points week over week. The Nasdaq closed lower on Friday of last week, down -9.32 points (-0.06%) and closing out the week at 14,360.39, up +330.01 points week over week.
In overnight trading, DOW futures traded lower and are expected to open down this morning 36 points.
Oil Rises for the Fifth Straight Week to its Highest Level Since 2018 on Strong Demand
Another strong week, folks: Oil prices climbed to their highest level since October 2018 on Friday of last week, putting both benchmarks up for a fifth week in a row on expectations demand growth will outstrip supply and OPEC+ will be cautious in returning more crude to the market in August. However, where oil goes from here is anyone’s guess. On Wednesday of last week, the United States agreed to lift all sanctions on the Iranian oil and shipping industry and to remove several senior officials from a blacklist. Approximately 1,040 Trump-era sanctions will be lifted under the agreement. It was also agreed to lift some sanctions on individuals and members of the supreme leader’s inner circle.
Despite sanctions being lifted, the finalization of the new nuclear deal between Tehran and Washington is yet to be reached. If you ask me, that is bad negotiating, as throwing a branch to the Iranians has never worked – remember the pallets of cash? – Oh my goodness! Let’s hope for the best outcome that is all we can do at this point.
WTI crude oil rose on Friday of last week +$0.75 a barrel to settle at $74.05 a barrel, up $2.41 a barrel week over week. Brent crude oil for August delivery closed higher on Friday of last week gaining +$0.62 a barrel, and closing at $76.18, up $3.03 a barrel week over week.
U.S. commercial crude oil inventories decreased by 7.6 million barrels week over week. At 459.1 million barrels, U.S. crude oil inventories are 6% below the five year average for this time of year.
Total motor gasoline inventories decreased by 2.9 million barrels week over week and are 1% below the five year average for this time of year. Finished gasoline inventories increased while blending components inventories decreased last week.
Distillate fuel inventories increased by 1.8 million barrels week over week and are 4% below the five year average for this time of year.
Propane/propylene inventories increased by 1.0 million barrels week over week and are 15% below the five year average for this time of year. Propane prices at Mont Belvieu soared above $1 per gallon on Wednesday of last week — the first time that’s happened in the month of June since 2014. U.S. propane inventories have been very skinny lately, sitting at 56.2 MMbbl. At the same time, propane exports have been riding high, averaging 1.3 MMb/d so far this year, up nearly 90 Mb/d from the same time frame in 2020, while production has remained virtually flat over the past 18 months. Either production needs to increase here in the U.S. or prices need to rise higher to discourage exports in order for us meeting heating demand here in North America for the winter. Canada also is seeing record exports out of Edmonton to Asia with prices spiking there over 80 cents U.S. a gallon last week (see U.S. Propane pricing)
Mont Belvieu Propane (Non-TET)
Total commercial petroleum inventories in the US decreased by 5.8 million barrels last week.
U.S. crude oil imports averaged 6.9 million barrels per day last week, up by 197,000 barrels per day week over week. Over the past four weeks, crude oil imports averaged 6.5 million barrels per day, 1.0% less than the same four-week period last year. Total motor gasoline imports (including both finished gasoline and gasoline blending components) last week averaged 840,000 barrels per day, and distillate fuel imports averaged 276,000 barrels per day
U.S. crude oil refinery inputs averaged 16.1 million barrels per day during the week ending June 18, 2021 which was 224,000 barrels per day less than the previous week’s average. Refineries operated at 92.2% of their operable capacity last week. Gasoline production increased last week, averaging 10.3 million barrels per day. Distillate fuel production increased last week, averaging 5.1 million barrels per day.
Oil is lower in overnight trading and, as of the writing of this report, WTI is poised to open at $73.97, down 8 cents per barrel from Friday’s close.
North American Rail Traffic
Total North American rail volumes were up 10.6% year over year in week 24 (U.S. +12.5%, Canada +8.6%, Mexico -4.3%) resulting in quarter to date volumes that are up 21.5% year over year and year to date volumes that are up 12.1% year over year (U.S. +13.7%, Canada +9.0%, Mexico +4.3%). 7 of the AAR’s 11 major traffic categories posted year over year increases with the largest increases coming from intermodal (+10.0%), coal (+31.2%), metallic ores & metals (+32.8%) and chemicals (+11.2%).
In the East, CSX’s total volumes were up 13.6%, with the largest increases coming from intermodal (+14.7%), coal (+53.1%) and metals & products (+60.9%). The largest decrease came from motor vehicles & parts (-14.9%). NS’s total volumes were up 12.8%, with the largest increases coming from intermodal (+8.6%), coal (+41.8%), metals & products (+65.6%) and chemicals (+24.3%).
In the West, BN’s total volumes were up 13.3%, with the largest increases coming from intermodal (+13.2%), coal (+27.0%) and metallic ores (+386.7%). The largest decrease came from grain (-19.7%). UP’s total volumes were up 11.6%, with the largest increases coming from intermodal (+9.8%), chemicals (+19.2%) and coal (+13.9%).
In Canada, CN’s total volumes were up 8.2%, with the largest increases coming from intermodal (+9.0%), coal (+96.3%) and petroleum (+28.2%). The largest decreases came from farm products (-59.7%) and grain (-20.5%). RTMs were up 9.8%. CP’s total volumes were up 16.2%, with the largest increases coming from intermodal (+20.9%), coal (+44.9%) and petroleum (+53.8%).
KCS’s total volumes were up 9.1%, with the largest increases coming from coal (+33.2%) and petroleum (+26.4%).
Source: Stephens
Rig Count
North American rig count is up by 9 rigs week over week. The U.S. rig count was flat week over week but up by 205 rigs year over year. The U.S. currently has 470 active rigs. Canada’s rig count was up by 9 rigs week over week and up by 113 rigs year over year and Canada’s overall rig count is 126 active rigs. Year over year we are up 318 rigs collectively.
North American Rig Count Summary
Things We are Keeping an Eye on
Petroleum by Rail
The four-week rolling average of petroleum carloads carried on the six largest North American railroads rose to 23,307, from 23,285 a gain of 22 rail cars week over week. Canadian volumes were mixed – CP shipments declined by 2.0% while CN shipments were up by 14.4%. U.S. volumes were mixed. The NS had the largest percentage increase, up by 5.9% and the BN had the largest percentage decrease down by 5.0%.
Alberta to Alaska Rail Road (“A2A”) hits a setback
The A2A Railway an Alberta corporation, has obtained creditor protection under a Canadian insolvency statute so that the Company can pursue a Court supervised sale/ refinancing of the development stage of the proposed 2000-mile rail link between the existing North American rail grid, and the Alaska Railroad and Alaska tidewater ports. This project is viewed in both Alaska and Alberta as a vital transportation link which will enable Alaska, Yukon, Northwest Territories, Alberta, and their respective economies, to have greater access to world markets for their raw materials and manufactured goods, in addition to providing for tourism and passenger travel. The move comes after A2A’s main lender, Bridging Finance Inc., was placed in Receivership by the Ontario Securities Commission on April 30. A2A obtained creditor protection late Friday of last week. The Company will also continue to work to preserve the firm’s value during the reorganization, refinancing, or sale process, and is currently working to inform partners and stakeholders of its intent to keep its commitments. Ultimately, construction of A2A Rail is expected to cost $22 billion CDN, and will cross lands in Alaska, Yukon, Northwest Territories, and Alberta creating a new North American gateway for a large variety of products, commodities, and tourism operations. (See below)
Alberta to Alaska Railway
Renewable Identification Numbers (RINS)
We are still watching them folks and they have continued to be very volatile and has driven gasoline prices to historic highs. The U.S. Supreme Court overturned a 2020 lower court ruling that limited EPA’s ability to grant Renewable Fuel Standard (RFS) exemptions to small refiners referred to as Small Refinery Exceptions (“SRE’s”) Friday morning of last week. In a nutshell, RINS in a very busy session on Friday of last week closed lower on the back of the Supreme Court Ruling that SRE’s for certain refiners issued by the EPA were legal. D6 RINS closed out the day and the week at $1.52 per RIN after trading to a low of $1.40 per RIN during the trading session, down 12 and ½ cents per RIN from Thursday’s close, but up 9 cents per RIN week over week. D4 RINS closed out the day and the week at $1.61 per RIN, down 14 cents per RIN from Thursday’s close, also up 9 cents per RIN week over week.
Magellan Pipelines
Magellan Pipelines Looking to transport biodiesel blended with regular diesel across its network in 1-2 years over even sooner, testing is underway. Magellan said that it is focusing on a significant opportunity to expand its role in renewable fuels that are they are strategically related to our existing business, assets and expertise. Magellan has been a provider of ethanol and biodiesel services for many years. Michael Mears, CEO of the Tulsa, Oklahoma-based company said last week. In remarks at the J.P. Morgan Energy, Power and Renewables Conference, Mears said the company, which stores, transports, and distributes crude and refined petroleum products, sees increasing commercial opportunities in biodiesel and renewable diesel. Could be another blow for the tank car as it is more efficient to transport such fuels by pipeline rather than rail.
Magellan Asset Map
Coal Prices
Coal prices have climbed to their highest level in a decade, making the fuel a hot commodity in a year when governments are pledging reductions in carbon emissions. Prices for thermal coal—which power plants burn to boil water into steam, spin turbines and generate electricity—have more than doubled over the past year as a result. Coal delivered into northwest Europe earlier this month hit its highest price since November 2011, having climbed 64% in 2021. Prices for coal exported from Newcastle in Australia, most of which heads to Asia, have risen 56%.
A shortfall of natural gas, rebounding electricity usage and scanty rainfall in China have lifted demand for thermal coal. Supplies have been crimped by a closed mine in Colombia, flooding in Indonesia and Australia and distorted trade flows caused by a Chinese ban on Australian coal.
Natural Gas Demand
Demand in Asia for U.S. natural gas for electricity generation has also been robust and have sent U.S. natural gas pricing soaring. U.S Natural Gas injections into storage are now 154 BCF below the 5 year average and things don’t look to get better anytime soon as long as U.S. exports continue to persist or we have a cool summer which is looking unlikely at this point.
We have been extremely busy at PFL with return on lease programs involving rail car storage instead of returning cars to a shop. A quick turnaround is what we all want and need. Railcar storage in general has been extremely active. Please call PFL now at 239-390-2885 if you are looking for rail car storage, want to trouble shoot a return on lease scenario or have storage availability. Whether you are a car owner, lessor or lessee or even a class 1 that wants to help out a customer we are here to “help you help your customer!”
Railcar Markets
Leasing and Subleasing has been brisk as economic activity picks up. Inquiries have continued to be brisk and strong Call PFL Today for all your rail car needs 239-390-2885
PFL is seeking:
- 100 31.8k CPC 1232’s for the Use in Gas or Diesel service in Texas for 1 Year.
- 100 30K 117R or J’s for the Use in Gas or Diesel service in Texas for 1 Year.
- 110 117 J’s 28.3 for dirty to dirty service in Alberta for crude.
- 95 Double Plug Plate F Box Cars in Washington
- 20 19,000 Gal Stainless cars in Louisiana UP for nitric acid 1-3 years negotiable
- 90-110 Pressure Cars 340s in Alberta on the CN 2-4 years Butane/Propane
- 10-15 Stainless 23.5 cars coiled and insulated in the East 1-2 years
- 5 Gondolas for Sale for aggregate in Texas any line
- 8 Hoppers for plastic pellets wanted to purchase
- 15-25 3915 CF PD Hoppers in Chicago any class one 3 year lease – negotiable
- 50-100 117Rs 30.3 gallon for refined products UP and BN Texas negotiable
- 18-25 5,200CF or greater covered hoppers needed in Illinois off the CN or NS.
- 20-25 30K 117Rs for the use in ethanol in the Midwest. Dirty to dirty service/
- 10 6,300CF or greater covered hoppers needed in the Midwest.
- 8 plastic pellet hoppers for purchase.
- 10 PD cars for cement service for purchase.
- 20 17K tank cars for purchase. Must be food grade.
- 50-100 C/I food grade tank cars needed for veg oil in the Midwest for 1 year
PFL is offering:
- Various tank cars for lease with dirty to dirty service including, nitric acid, gasoline, diesel, crude oil, Lease terms negotiable, clean service also available in various tanks and locations including Rs 111s, and Js – Selection is Dwindling. Call Today!
- 50 29,188 US GAL EC&I CPC 1232s with Magnetic gage rods for up to 1 year starting ASAP
- 200 4300 Hoppers in Canada – Lined and dirty Negotiable
- 20 117R 30K plus tanks for ethanol in Wisconsin off the CN Negotiable
- 80 6350 Grain Hoppers in Nebraska on the BN Clean Negotiable
- 90 117Rs 30K located in Alberta CN or CP Refined Products Dirty – negotiable
- 37 BRAND NEW 5161 Sugar Hoppers in Arkansas UP – negotiable
- 205 117Js 29K BRAND NEW in Colo and Iowa off the UP, BNSF – price negotiable
- 99 340W Pressure Cars various locations Butane and Propane dirty negotiable
- 100 340W Pressure Cars Montana or Kansas LPG last in – negotiable
- 218 73 ft 286 GRL riser less deck, center part for sale,
- 19 auto-max II automobile carrier racks – tri-49 for sale – negotiable
- 10 food grade stainless steel cars
- 30 CPC 1232 25.5K Pennsylvania NS clean negotiable
- 20-30 29K C/I 117J cars for lease up to 1 year. Dirty in Biodiesel and can be returned dirty.
- 100-150 29K C/I 117J cars for lease. Dirty in Bakken crude and can be returned dirty.
- 100 29K C/I 117J cars for lease. Dirty in Heavy Crude and can be returned dirty.
- 100-200 LPG Tanks dirty to dirty up to 5 years – various locations – negotiable
- 100 117Rs 29K clean last used in crude Washington State – price negotiable sale or lease
- 21 111s 29K tanks last in alcohol dirty on the CN in Wisconsin for lease price negotiable
- 100 111s of various volumes and locations last in fuel oil dirty price negotiable
- Various Hoppers for sale and lease 3000-5800 CF 263 and 286 multiple locations negotiable
- 45 Boxcars 60ft Plate F’s Located in Tenn CSX – Lease Negotiable
Call PFL today to discuss your needs and our availability and market reach. Whether you are looking to lease cars, lease out cars, buy cars or sell cars call PFL today 239-390-2885
PFL offers turn-key solutions to maximize your profitability. Our goal is to provide a win/win scenario for all and we can handle virtually all of your railcar needs. Whether it’s loaded storage, empty storage, subleasing or leasing excess cars, filling orders for cars wanted, mobile railcar cleaning, blasting, mobile railcar repair, or scraping at strategic partner sites, PFL will do its best to assist you. PFL also assists fleets and lessors with leases and sales and offer Total Fleet Evaluation Services. We will analyze your current leases, storage, and company objectives to draw up a plan of action. We will save Lessor and Lessee the headache and aggravation of navigating through this rapidly changing landscape.
PFL IS READY TO CLEAN CARS TODAY ON A MOBILE BASIS WE ARE CURRENTLY IN EAST TEXAS
Live Railcar Markets
| CAT | Type | Capacity | GRL | QTY | LOC | Class | Prev. Use | Clean | Offer | Note |
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