Fueling Strategy: Please wait to fuel until after midnight, Wednesday AM wholesale prices will drop almost 4 cents – Be Safe Tonight!

NYMEX Crude $ 30.44 DN $.9700
NY Harbor ULSD $ .9901 DN $.0248
NYMEX Gasoline $1.0848 DN $.0282

NEWS
The U.S. oil benchmark closed sharply lower Tuesday after briefly trading below $30 a barrel for the first time since 2003, extending a 2016 rout fueled by a global supply glut, jitters about the global economy and a rising dollar.

On the New York Mercantile Exchange, light, sweet crude futures for delivery in February fell 97 cents, or 3.1%, at $30.44 a barrel—its lowest finish since Dec. 1, 2003—after dipping as low as $29.93. February Brent crude on London’s ICE Futures exchange dropped 69 cents, or 2.2%, to finish at $30.86 a barrel, the lowest finish for the global benchmark since April 2004. Both grades have fallen for seven straight sessions, leaving WTI futures down nearly 18% in the new year, while Brent has dropped 17.2%.

The overwhelming supply and demand equation that has encouraged dramatic selling is going nowhere anytime soon, with a persistent aggressive oversupply in the markets consistently haunting investor attraction, while weaker forecasts around global growth weighs on demand, and it is likely that more global economic downgrades from major institutions are to follow early this year,” said Jameel Ahmad, chief market analyst at FXTM, in a note. Oil saw renewed pressure as the dollar rose against rival currencies. Some analysts have argued that a rising U.S. currency is the most bearish factor at the moment. A stronger dollar is often seen as a negative for commodities priced in the currency, as it makes them more expensive to users in nondollar terms. Morgan Stanley said Brent oil may fall as low as $20 a barrel on an appreciating dollar—oil prices could decline 10% to 15% if the currency gains 5%. Goldman Sachs also expects global oil to head toward $20 a barrel before producers decrease output.

Nigeria on Tuesday said some members of the Organization of the Petroleum Exporting Countries, or OPEC, are pushing for an emergency meeting to address plunging oil prices, but an official from the United Arab Emirates appeared to dismiss the idea. Previous calls by some OPEC producers for emergency meetings aimed at reining in production have been ignored by Saudi Arabia and its Gulf allies. The Saudis are seen attempting to force out lower-cost producers, such as those in the U.S. shale regions, by keeping downward pressure on oil prices. “I think the strategy is working,” said UAE oil minister Suhail bin Mohammed al-Mazrouei, at an energy conference in Abu Dhabi.

Meanwhile, rising volatility in the Chinese stock market and confusion surrounding Beijing’s yuan policy last week had heightened fears of a steeper slowdown in the world’s second-largest economy. A rebound by the yuan in recent sessions has helped soothe worries. Global equities were on the rise. But uncertainty over China lingers, and could continue to add to negative sentiment on oil futures, analysts said. Gordon Kwan, the regional head of Nomura oil and gas research, called the situation a “crisis of confidence” in the Chinese economy.

Meanwhile, Iranian oil is expected to return to the market after the sanctions on its crude exports are lifted this quarter. Iran has said it could export at least 500,000 barrels of oil a day as soon as the ban is repealed. “The issue of growing oversupply has been plaguing the industry for more than a year. Although U.S. shale production is slowing, it is still not slowing down fast enough for demand to catch up,” a Singapore-based trader said. However, the more bullish camp said there is little room for prices to drop further and that a rebalancing in supply and demand is around the corner. “We remain wary of further downward movement to oil prices, however, [we] continue to remain skeptical over how much lower prices can go,” said Daniel Ang, a Phillip Futures energy analyst.