Clorox, the world’s largest cleaning products maker stated yesterday, that one of their most popular items will not be fully in stock until next year. Clorox CEO Benno Dorer, stated that the company is struggling with the massive demand increase caused by the pandemic for their top selling product, disinfecting wipes. The fact that consumers are stockpiling the product as well as the short supply of raw materials used to make the wipes are two of the main reasons behind the disruption in the supply chain.
On the morning of Monday, January 6, 2020, WTI crude oil was nearing $64/bbl. As of 10:31 a.m. EST on Thursday, February 27, 2020, WTI crude oil was trading at $46.36/bbl. The shocking effects of the coronavirus fear continue to decimate global markets, particularly oil markets. Fortune.com aptly points out that the coronavirus has done to the oil industry what the U.S. and China trade war, strikes on Saudi oilfields, Libyan supply outages, and a near war between the U.S. and Iran-could not. The virus has thrown traders and analysts into complete turmoil.
Oil prices are trading lower today primarily because our industry is looking at the weakening Hurricane Florence more so as petroleum demand destruction rather than a supply disruption event.
As we navigate through peak hurricane season, market participants are glued to their weather consoles watching, waiting, anxiously for every update to the two weather disturbances, two hurricanes and a tropical storm churning in the Atlantic and Gulf Coast.
Many disruption scenarios can occur when a hurricane hits the U.S. directly. Whether it hits the Gulf Coast refineries and off shore oil rigs, New York Harbor refineries or the Carolina’s where there isn’t an energy infrastructure presence but a high density of population. I had the pleasure to meet with one of our experts, Mike Dombroski, Commercial Sales Account Manager to discuss in more detail how to better prepare and what could happen to fuel prices if you’re not ready.