And now these predictions are starting to come true. Add to this mix statements from the oil-producing cartel that its members planned no increases in their oil production and the situation looks even worse. The cold snap froze rivers in the region and made it even more difficult to replenish inventories. We are now in an even more precarious position, since refiners let distillate inventories fall well below customary levels this summer, as a shortage of crude and higher margins on gasoline encouraged them not to build up heating oil and distillate stocks. Refiners now report they are going full tilt but are unable to catch up to demand, let alone produce enough distillate to replenish inventories, which might well help nudge prices downward.
Spring certainly seems a long way off.