Fueling Strategy: Please partial fill today/tonight, Wednesday AM wholesale prices will drop 2.5 cents – Be Safe

NYMEX Crude $ 48.19 UP $.7900
NY Harbor ULSD $1.4662 UP $.0069
NYMEX Gasoline $1.5545 UP $.0164

NEWS
Oil staged a rebound to settle higher on Tuesday, as traders bet that U.S. government data will show a ninth consecutive weekly decline in crude supplies, and concerns surrounding Qatar’s diplomatic crisis eased. “The market has realized geopolitical tension is unlikely to ratchet up in the Middle East, with Qatar likely wanting to diffuse the situation rather than escalate it,” Matt Smith, director of commodity research at ClipperData, told MarketWatch. “Some buying interest appears to have entered the fray as we await confirmation of a ninth consecutive draw to crude stocks from [Wednesday’s] weekly inventory” report. Kuwait began mediating between Qatar and the Persian Gulf nations that cut ties with Doha, according to the Associated Press.

On the New York Mercantile Exchange, July West Texas Intermediate crude added 79 cents, or 1.7%, to settle at $48.19 a barrel after tapping lows under $47. August Brent crude on London’s ICE Futures exchange rose 65 cents, or 1.3%, to $50.12 a barrel.

On Monday, global oil markets saw major swings, with prices first spiking nearly 2% then dropping to a one-month low after news that Saudi Arabia and three other Persian Gulf states severed diplomatic ties with Qatar, a member of the Organization of the Petroleum Exporting Countries. Qatar is considered a minor crude producers, but there have been concerns that the developments may have an effect on the OPEC-led agreement to cut production, which has been extended through March of next year. “The implications of Qatar exiting from the OPEC production cut deal would be minimal, given their commitment to cut by 30,000 [barrels a day],” according to Smith. Its “exports to leading destinations are also likely to be unaffected.”

A survey from S&P Global Platts released Tuesday showed that OPEC oil output marked their first monthly climb since October to 32.12 million barrels a day in May. In a monthly report issued Tuesday, the EIA raised its production outlook for this year and next. For 2018, it sees average output of 10.01 million barrels a day, up 0.4% from its previous forecast, and for 2017, it forecast 9.33 million barrels a day, up 0.3% from last month’s forecast. The government agency also cut its WTI and Brent oil-price forecasts for next year. Traders will be closely watching U.S. weekly oil data due Wednesday from the Energy Information Administration. The American Petroleum Institute will issue its own report ahead that later Tuesday. Analysts polled by S&P Global Platts forecast a decline of 3.5 million barrels in crude-oil stocks for the week ended June 2.

Have a great day,

Loren R. Bailey, Founder & Owner
FUEL MANAGER SERVICES INC
“Serving the Trucking Industry Since 1992”