Market Close: July 22 MIXED, Diesel UP $.0157, Gas UP $.0202
Jul 23rd, 2024 by loren
July 23rd Fueling Strategy: Please “KEEP YOUR TANKS TOPPED TODAY/TONIGHT, Wednesday prices will go UP 1.5 Cents ~ Be Safe Today
NMEX Crude $ 79.78 DN $.3500
NYMEX ULSD $2.4348 UP $.0157
NYMEX Gas $2.4706 UP $.0202
NEWS
Sep WTI crude oil on Monday closed down -0.35 (-0.31%), and Sep RBOB gasoline closed up +1.46 (+0.60%).
Crude oil prices on Monday extended last Friday’s sharp losses on concern about the global economy and US political uncertainty. China’s -10 bp rate cut on Monday reinforced worries about China’s weak economy. The markets were already worried about Asian economic growth after Japan’s Cabinet Office last Friday cut its Japan 2024 GDP projection to +0.9% from a previous estimate of +1.3%. Meanwhile, US political uncertainty increased after President Biden on Sunday dropped out of the presidential race and endorsed Vice President Harris.
Crude has support from wildfires in Canada that threaten to curb Canadian crude production. Rystad Energy said last Friday that 52 out-of-control wildfires in Alberta, Canada, threaten nearly 500,000 bpd of crude oil sands output and pipeline shipments to the US.
A decline in crude oil in floating storage is bullish for prices. Last Monday’s weekly data from Vortexa showed that the amount of crude oil held worldwide on tankers that have been stationary for at least a week fell -20% w/w to 74.53 million bbl as of July 12.
In a bearish factor, Russia’s crude exports in the week to July 14 rose by +200,000 bpd to 2.97 million bpd, according to vessel-tracking data compiled by Bloomberg. Also, higher-than-expected Russian crude output is bearish for oil prices. Russian crude production averaged 9.078 million bpd in June, above its agreed target of 9.049 million bpd.
OPEC+ rolled out a plan to restore some crude production in Q4, which sparked worries about a glut in global oil supplies. On June 2, OPEC+ extended the 2 million bpd of voluntary crude production cuts into Q3 but said they would gradually phase out the cuts over the following 12 months, beginning in October. OPEC pledged to extend its crude production cap at about 39 million bpd to the end of 2025. Also, the UAE was given a 300,000 bpd boost to its production target for 2025. In June, OPEC crude production fell -80,000 bpd to 26.98 million bpd.
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Loren R Bailey, President
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