This Week’s Market Buzz


• Oil prices edged lower at press time as traders awaited data on U.S. oil stockpiles. U.S. crude futures fell 6 cents, or 0.1 percent, to $59.58 a barrel on the New York Mercantile Exchange. Brent Crude, the global benchmark, fell 6 cents, or 0.09 percent, to $66.38 a barrel on ICE Futures Europe. Both grades have approached their highest levels since 2015.

• The accompanying chart shows the growth in demand for frac sand and the forecast for the next two years. As the chart shows, the 2017 expected demand is much higher compared to prior years. The demand is expected to grow at a 62 percent compound annual growth rate (CAGR) over two years. The consensus estimates put expected demand in 2017 at 77 million tons, up from 39 million tons in 2016. Jefferies estimate of demand in 2017 is highest at 81 million tons. For the projected frac sand demand in 2018, the consensus estimate is 102 million tons. While TPH estimates the demand in 2018 at 121 million tons, Jefferies expects it to be just 90 million tons. As the chart shows, the demand level is expected to remain much higher than prior years, even with the most conservative estimates.

• The South Windsor, Conn., town council will hold a public hearing in January and listen to a presentation from the activist group Food and Water Watch before voting on an ordinance that aims to ban fracking waste from being brought into South Windsor. Ordinances have been passed by 33 towns and cities banning the storage or use of fracking waste, according to The Courant. The state has a temporary moratorium on waste produced from fracking while the state Department of Energy and Environmental Protection adopts regulations that would govern its disposal and processing.

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